Preamble

The House met at a Quarter past Two o'Clock

PRAYERS

[MR. SPEAKER in the Chair]

ADDRESS FOR RETURN

The following Notice of Motion stood upon the Order Paper in the name of Squadron-Leader DONNER:
 Return of the names of all trade unions which have come into being since 1938; their latest, membership figure; the names of the unions covering the workers concerned at the time of the establishment of these new unions; and their Latest membership figure in the categories of workers afforded this duplicate representation.

Squadron-Leader Donner: On a point of Order. May I ask, Mr. Speaker, why the Notice of Motion on the Order Paper in my name asking for a return in connection with trade unions has not been called?

Mr. Speaker: The hon. and gallant Gentleman ought to be aware by now that consent was not given, and, that 'being so, he cannot move his Motion.

Squadron-Leader Donner: Further to that point of Order, Mr. Speaker. Is there any opportunity available for me to move this Motion?

Mr. Speaker: Not without consent.

Oral Answers to Questions — HOUSING

Flats (Rent Control)

Major Legge-Bourke: asked the Minister of Health what regulations exist for the control of rent in relation to a licence granted for the reconversion of a purchased house into a number of flats.

The Minister of Health (Mr. Aneurin Bevan): There are no regulations dealing with the matter to which the hon. and gallant Member refers, and I doubt if, in view of the widely varying circumstances, this matter could appropriately be dealt with by general Regulation.

Major Legge-Bourke: Does not the right hon. Gentleman realise that the Rent Restriction Act does not apply to houses not let in 1939, and that unlimited profit can be made from houses now let that were not let at that time? Will he make Regulations to prevent such profits being made by this exploitation of the housing shortage?

Mr. Bevan: These circumstances are of infinite variation, and it is extremely difficult to see how Regulations can be framed which will deal accurately with each set of circumstances. I will, however, look at the matter again to see if something can be done.

mMr. Godfrey Nicholson: Is the Minister aware that in one London borough his Department is preventing conversion of war-damaged houses into flats by insisting that the houses shall first be restored as single houses before the necessary money is spent on converting them into flats? Is not that a great waste of money?

Mr. Bevan: That is an entirely different question.

Temporary Houses (Furniture)

Major Legge-Bourke: asked the Minister of Health how many local authorities have fixed the terms and conditions for providing furniture to tenants of prefabricated houses; and if he will give the average minimum deposit required, the average period to be covered by the agreement, and the average interest rate to be charged.

Mr. Bevan: I regret that the information is not available.

New Building (Statistics)

Lieutenant William Shepherd: asked the Minister of Health if he will state the number of houses which his Department estimates it will be necessary to build before the housing stringency is eased

Mr. Bevan: Easing of the.housing stringency is a matter of opinion and does not lend itself to precise statistics. The erection of the 750,000 houses which have been estimated to be needed in order to provide a separate house for each family would substantially improve the present position.

Lieutenant Shepherd: Will the right hon. Gentleman say whether this figure of 750,000 was the one which he had in mind when he said that the stringency-would be eased by the end of 1947?

Mr. Bevan: The answer is that various estimates have been formed as to the number of houses needed to be built in Great Britain, and they vary from 750,000 to 6,000,000, so the hon. Member can take 'his choice.

Ex-Servicemen

Lieut.-Colonel Sir Ian Fraser: asked the Minister of Health if he will direct local authorities to give a priority in housing to ex-Servicemen, who are disabled in the highest degree, which will override municipal boundaries.

Mr. Bevan: Housing authorities have already been asked in Circular 109/45, of which I will send the hon. and gallant Member a copy, to give ex-Servicemen every consideration in accordance with their relative needs and in appropriate cases to waive any residential qualification they may have laid down.

Sir I. Fraser: Is the Minister aware that some local authorities have passed resolutions confining their housing list to their own inhabitants, and will he bear in mind that these men fought for Britain and not for parish boundaries?

Mr. Bevan: If the hon. and gallant Gentleman will let me knew the authorities who have passed resolutions of that sort, I will redirect their attention to my circular.

Applications and Tenders

Sir Waldron Smithers: asked the Minister of Health the number of applications made for houses by local authorities; the number of houses in course of erection; and the number approved.

Mr. Bevan: Local authorities have applied for authority to invite tenders for 81,007 houses and have been authorised to invite tenders for 78,301 houses. Tenders for 25,676 of these houses have been

accepted. The number of houses in course of erection will not be known until returns are received from the local authorities in the New Year.

Sir W. Smithers: Will the Minister say how that answer squares with the promises made in such wholesale fashion by the Socialist Party at the General Election?

Mr. Bevan: When these figures are announced they will prove that the Government have accelerated their housing programme far more than they might have been expected to do if hon. Members opposite had been in office.

Lieut.-Commander Gurney Braithwaite: Can the Minister say if the plans of the local authorities are making more rapid progress through the bottleneck of Ministerial approval, which appears to average three months?

Mr. Speaker: This was the sort of question that might well have been put down for a written answer. The supplementaries are not really relevant.

Loans (Interest Rate)

Mr. Coldrick: asked the Minister of Health whether, in view of the fact that housing associations intend to provide a good type of house at the lowest possible rent, he will make an early announcement regarding a lower rate of interest on loans for housing purposes; and whether such loans can be made on a basis of 100 per cent, of the total valuation.

Mr. Bevan: The rate of interest on loans by local authorities to housing associations depends on the rate of interest at which the local authorities themselves are able to borrow. The rates of interest charged by the Public Works Loan Board for loans to local authorities for this and other housing purposes, and for loans made by the Board direct to housing associations are for the Treasury to determine. Loans by local authorities or by the Public Works Loan Board to housing associations are limited to 90 per cent. of the value of the property.

Mr. Lipson: Can the Minister say when local authorities are to be told what rate of interest they will be charged?

Mr. Bevan: Local authorities are much more interested in the subsidy than the rate of interest.

Mr. Lipson: They want to know both.

Mr. Bevan: They have been told.

Hutments

Mr. John McKay: asked the Minister of Health if he is aware that there are in the Longbenton urban district area a number of military camps, complete with hutments and equipped with water supply and drainage facilities, which have been unoccupied for a considerable time and in the opinion of the urban council are suitable for meeting the need for houses as a temporary measure; and what steps under these circumstances does he intend to take to get the use of these buildings to house the people in this district.

Mr. Bevan: I have been approached by the Longbenton Urban District Council about various camps in their area and I am seeing whether they can be made available. If they can, I am prepared to consider proposals for their use as temporary housing accommodation.

Area Limitation

Mr. Gerald Williams: asked the Minister of Health whether he is aware that, under Regulation 56A, plans for the erection of houses have to be refused by local authorities if they provide for a maximum area of more than 1,000 superficial feet; and whether, in view of the fact that this restriction prevents the building of desirable types of houses in rural districts, he will take steps to amend the regulation at an early date.

Mr. Bevan: I am aware of the limitation to which the hon. Member refers and consider its retention necessary in order to ensure that the most urgent needs are met first.

Mr. Williams: Does the Minister agree that although these limitations may be necessary in urban areas, in rural areas where there is no pressure on space the amenities could be considerably improved without any additional cost?

Mr. Bevan: I have already arranged a limit very much above that of the previous Government. It is now from 900 to 950 superficial feet upwards to 1,000. The increase is substantial, and is much appreciated by the rural authorities.

Mr. Manningham-Buller: Will the Minister say what increase he has made in the limits for private houses; and secondly, whether the maximum of 1,000 superficial feet takes in outbuildings?

Mr. Bevan: No, it does not. As to the first part of the supplementary question, in fact the limitation is not upon the superficial area but upon the price. If hon. Members opposite will co-operate with me to bring down costs, a bigger house can be built for the same price.

Mr. Willink: Will the Minister reconsider that answer? Is it not a fact that there is a limitation not only on price but in regard to the size of houses built by private enterprise? Will he also answer the first part of the supplementary question as to whether he has raised the standard of houses to be built by private enterprise, as he alleged in his own answer?

Mr. Bevan: The limitation is on price. Within the limits of that price the private builder can build what he likes. There are certain standards which the private builder must obey, because we do not want the speculative builder building any kind of houses in Great Britain.

Sites (Kent)

Mr. G. Williams: asked the Minister of Health if he will state the number of prepared sites in the hands of private builders and of unprepared sites taken over by local authorities, with details as to the number of houses actually completed by local authorities and private firms, respectively, in the county of Kent to the present time.

Mr. Bevan: In the county of Kent there are, I understand, privately owned building sites capable of taking approximately 19,000 houses; and publicly owned building sites capable of taking approximately 25,000 houses, excluding sites earmarked for approximately 5,000 temporary houses. These sites are in various stages of development, and I am not at present in a position to give fixures of the number of houses completed.

Mr. Williams: Will the Minister tell us whether, if these sites are available, he will give the same advantage to private enterprise to enable it to put the houses up?

Mr. Bevan: That is merely repetitive.

Allocation

Mr. Hurd: asked the Minister of Health if he will state the instructions issued to local authorities as to how they are to work a points scheme in allocating new houses when they are built.

Mr. Bevan: I would refer the hon. Member to the answer given to the hon. and gallant Member for East Renfrew (Major Lloyd) on 15th November. A copy of the report mentioned therein is being sent to the hon. Member.

Temporary Houses (Northern Ireland)

Dr. Little: asked the Minister of Health whether as he has been asked for 2,000 prefabricated houses for Northern Ireland where the housing problem is specially pressing, he will state the number of these houses granted, as the foundations for the first instalment will shortly be ready.

Mr. Bevan: I have placed orders which will enable me to allocate 2,000 temporary houses for Northern Ireland. The allocation of these houses within Northern Ireland is a matter for the Northern Ireland Ministry of Health.

Dr. Little: Will the Minister see that these houses are forwarded as sites are ready, as it is a pressing matter today?

Mr. Bevan: I will give exactly the same guarantee as to dates of arrival for Northern Ireland as for England and Wales.

Subsidy

Mr. Lipson: asked the Minister of Health if he is now able to say what will be the form and amount of the housing subsidy to local authorities.

Mr. Bevan: This question is still under discussion with the representatives of the local authorities, who have asked that they should be given time to consider it.

Mr. Lipson: Could the Minister say when he hopes to be able to give this information?

Mr. Bevan: I had hoped to do so before the House rose for the Recess, but it now looks to me as though it will have to be afterwards.

Tenders

Mr. Lipson: asked the Minister of Health to what extent the reduction in the amounts of housing tenders is due to local authorities modifying their specifications to enable the cost of houses to come within the prescribed limit.

Mr. Bevan: In certain instances items which were not essential have been taken out, but this is not the means by which I am seeking a general reduction of tenders, and I shall do all I can to uphold and improve standards and amenities, as circumstances allow.

Mr. Lipson: Will the Minister inform his officers that a reduction in price is not to be obtained by providing an inferior house?

Mr. Bevan: There are some instances of tenders being reduced by taking out frills while retaining standards.

Oral Answers to Questions — LOCAL AUTHORITIES

Water and Sewerage Schemes (Grants)

Mr. Baldwin: asked the Minister of Health whether he will now state the percentage grant which will be paid to local authorities who undertake water supplies and sewage disposal schemes under the Rural Water Supplies and Sewerage Act, 1944; and whether it is proposed to increase the grant of £15,000,000 as stated in Subsection (5), of Clause 1, of the Act.

Mr. Bevan: There will be no fixed rate of grant. The grant will be assessed on the estimated net annual cost of the scheme, with due regard to the ability or otherwise of the local authority to meet the cost. I am not yet in a position to say whether the £15,000,000 provided by the Rural Water Supplies and Sewerage Act, 1944, will be sufficient or will need to be increased.

Mr. Baldwin: Will the right hon. Gentleman reconsider the question of increasing this grant, in view of the fact that many grandiose schemes are being prepared which will involve expenditure of £50,000,000 or £60,000,000, and is it worth while a rural district council going in for expensive schemes unless they know that they will get some satisfactory recompense?

Mr. Bevan: I hope that nothing the hon. Member has said will deter local authorities from preparing their water schemes. I am very anxious that they should go on. If more money is needed, I shall not hesitate to ask Parliament for it.

Crown Property (Rates)

Mr. Ayles: asked the Minister of Health if he is aware of the loss being sustained by the Hayes Urban District Council, Middlesex, owing to Section 64 of the Rating and Valuation Act, 1925, under which Crown properties are not subject to the ordinary method of valuation, but the Crown makes a contribution in aid of rates; and as by reason of the recent increase in the number of Crown properties in their district and throughout the country, the continued operation of such provision is increasingly inequitable to local authorities, whether he will introduce legislation to end this state of affairs at the earliest possible date.

Mr. Bevan: I cannot accept the statement that contributions from national funds in lieu of rates in respect of Crown property involve local authorities throughout the country in loss, and I can hold out no hope of legislation on the lines suggested.

Mr. Ayles: Will the Minister see that the ex-gratia payments which are made approximate more nearly to the rates that would have been received by the local authority in the ordinary way?

Mr. Bevan: I car recollect no representations having been made by associations of local authorities on the point. I am quite certain that if they felt aggrieved they would be very active in raising the matter.

Oral Answers to Questions — PUBLIC HEALTH

Nursing Services

Mr. Hardy: asked the Minister of Health whether his attention has been drawn to the de-grading of certain nursing officials employed by the Lancashire Mental Hospitals Board, due to the introduction of the Rushcliffe salaries scale, which is having an unfavourable effect on the qualified staff who are still performing the same duties as previously and who, by reason of this de-grading, are receiving little or no financial benefit; and if he will take steps to ensure that local authorities are more generous in their interpretation of the Rushcliffe recommendations.

Mr. Bevan: I understand that the point to which my hon. Friend refers has been, and still is, under consideration by the

Mental Nurses' Sub-Committee appointed in association with the Rushcliffe Nurses' Salaries Committee, and I do not think I could usefully intervene.

Mr. John Lewis: asked the Minister of Health whether he has yet received a report on mental nursing from the Athlone Committee; and what action he proposes to take.

Mr. Bevan: Yes, Sir. My right hon. Friend the Minister of Education and I have received from the Earl of Athlone the report of the Sub-Committee on Mental Nursing and the Nursing of the Mentally Defective which was appointed by the Athlone Inter-Departmental Committee on Nursing Services. The report, which will be published as a Stationery Office publication before the House rises for the Recess, is a most valuable survey of the whole field falling within the Sub-Committee's scope, and my right hon. Friend and I are deeply indebted to the members of the Sub-Committee. I propose to obtain without delay the views of the various interested bodies regarding the recommendations, many of which would require legislation.

Doctors (Release)

Colonel Stoddart-Scott: asked the Minister of Health what are the principles upon which has been based the acceleration of the release of medical officers from the Forces under Class A in order to relieve the inadequacy of medical services available for the civilian population; how many doctors will have been demobilised under existing arrangements by 1st January, 1946, under A and B; and how many will be demobilised from the services during the first six months of 1946.

Mr. Bevan: In accelerating the release of medical officers from the Forces, the aim has been to reduce the ratio of doctors to serving personnel to about two per thousand. I cannot give the exact number who will have been released by 1st January next, but it is expected to be at least 5,000. I regret that I cannot yet give the figure asked for in the last part of the Question.

Colonel Stoddart-Scott: Is the Minister aware that in the Navy there is one doctor for every 300 personnel, whereas in some parts of this country, there is one doctor


for every 3,000 persons; and is he satisfied that this acceleration is enough to catch up with this discrepancy?

Mr. Bevan: I am satisfied that very considerable acceleration has been achieved and will be achieved. The comparison of the number of doctors per thousand in civil life with the number of doctors in the Navy is obviously unfair, beacuse you have to have a certain number of doctors per ship.

Cancer

Mr. Somerville Hastings: asked the Minister of Health whether, in view of the fact that there are about 70,000 deaths annually from cancer and that a large proportion of these only obtain specialist treatment when too late, he will provide lectures for general practitioners on the early recognition of this disease.

Mr. Bevan: The object my hon. Friend has in mind can perhaps be best attained by encouraging early and frequent consultation between general practitioners and specialists in the work of diagnosis and treatment. Organised arrangements for this purpose are now being developed under the Cancer Act, 1939, as far as present circumstances permit.

Mr. Hastings: May I ask the Minister if he is aware that where such lectures have been instituted, they have been much appreciated and well attended by general practitioners?

Mr. Bevan: I appreciate what the hon. Gentleman says and I will direct the attention of the appropriate authorities to his comment.

Colonel Stoddart-Scott: Will the right hon. Gentleman also take steps to instruct the general public with regard to the early signs and symptoms of cancer, as very often when a patient goes to his general practitioner it is then too late for specialist treatment?

Mr. Bevan: Speaking on the impulse of the moment, it would, I think, be extremely dangerous to try to instruct the general public, because you may have a nation of hypochondriacs.

Home Patients (Blankets)

Mr. Peter Freeman: asked the Minister of Health whether he will arrange to have available a number of priority

dockets for the use of medical officers of health for the supply of blankets for use when patients are unable to obtain immediate admission to hospital and have to be temporarily treated at home because of lack of nursing staff or hospital accommodation, as is already being done in the case of expectant mothers.

Mr. Bevan: The evidence I have does not suggest that action on the lines suggested by my hon. Friend would be justified.

Mr. Freeman: Is my right hon. Friend aware that there are large numbers of cases of tuberculosis which have been diagnosed as a result of radiography, and that many of these cases will need such help?

Mr. Bevan: I am aware of the development of early diagnosis, and that earlier diagnosis has resulted in the detection of a larger number of tuberculosis cases. Where there are distressful cases of the kind mentioned by my hon. Friend, the local authority would obviously deal with them.

Tuberculosis Cases (Clothing)

Mr. P. Freeman: asked the Minister of Health whether he will arrange to have available additional clothing coupons for tubercular patients to obtain certain necessary clothing for use in hospitals, who are otherwise under hardship and who are unable to obtain them except after long delay, thus accentuating their suffering and mitigating their usefulness; or alternatively, if he will place a small number of clothing coupons at the disposal of medical officers for use in such urgent cases.

Mr. Bevan: If my hon. Friend would let me have fuller particulars of any cases of special hardship in this matter which have come to his notice, I will be glad to look into them.

Mr. Freeman: Is the Minister aware that I have already sent three letters to him on 28th November, 30th November and 4th December dealing with these points, which give this information and that I am still awaiting a reply?

Mr. Bevan: If my hon. Friend mentions that he has sent letters towards the end of last month I must now make inquiries back to the source, and the information


must come back before I reply. In this case I should have thought that the lapse of time was quite reasonable.

Water Supply (Peterborough)

Mr. Tiffany: asked the Minister of Health what number of parishes in the constituency of Peterborough are without a piped water supply; and in what areas have schemes been prepared for the extension of piped supplies.

Mr. Bevan: The answer to the first part of the Question is 26. Schemes have been prepared by the Oundle and Thrapston Rural District Council for 24 of these parishes and by the Kettering Rural District Council for one of them.

Penicillin (Synthesisation)

Mr. J. Lewis: asked the Lord President of the Council by whom penicillin has been synthesised; and what is the structural formula.

The Lord President of the Council (Mr. Herbert Morrison): A practical process for synthesizing penicillin has not yet been evolved. As regards the second part of the Question, I understand that the British workers associated with the Medical Research Council and their American collaborators propose to publish available information at an early date.

Mr. Lewis: Is my right hon. Friend aware that penicillin has already been synthesised by the "Daily Express"?

Mr. Morrison: I would not be a bit surprised.

Oral Answers to Questions — EDUCATION

University Scholarships (Financial Awards)

Sir Robert Young: asked the Minister of Education whether she has yet issued regulations under Section 81 of the Education Act authorising county education committees to make increased financial awards to those winning county major scholarships at Oxford and Cambridge; whether any such increased awards have been made; and whether these increased awards will be given to those awarded similar scholarships before the date of the new regulations.

The Minister of Education (Miss Wilkinson): Yes, Sir. The regulations for scholarships and other benefits made under Section 81 of the Education Act, 1944, were issued last March, together with a circular in which guidance was given to local education authorities as to the amounts appropriate for major awards. A large number of authorities have submitted their arrangements indicating substantial improvements in their awards, and these have been approved and are already in operation. I have asked authorities whose arrangements have not yet been submitted to let me have them as soon as possible. I must leave it to authorities to decide whether to increase awards which were made before the new schemes were adopted, but I have no doubt that some will wish to do so and their expenditure will, of course, be recognised for grant.

Sir R. Young: Does my right hon. Friend appreciate that the awards granted are not the same for both classes of people holding the same scholarship under the various education authorities?

Miss Wilkinson: We have that point fully in mind. If my hon. Friend will wait a little while he will see that that point is met by my answer.

Training Colleges (Lecturers' Accommodation)

Colonel Erroll: asked the Minister of Education whether she will improve the accommodation for married resident lecturers at present available at teachers' training colleges.

Miss Wilkinson: This matter will not be overlooked when it is possible to undertake new building work or substantial extensions to existing training college buildings.

Colonel Erroll: Does the right hon. Lady realise that the lack of accommodation is seriously deterring would-be lecturers from taking up posts in training colleges, so jeopardising the success of the training scheme? It is an urgent matter to improve the accommodation.

Miss Wilkinson: I am fully aware that it is an urgent matter. It is equally the fact that it is impossible to do anything about it, except in a rather improvised way. Colleges are meeting the problem


in an improvised way, and I would like to say that the staffs, on the whole, appreciate our difficulties.

Boarding Schools

Mr. King: asked the Minister of Education if having regard to the provision of boarding facilities by L.E.A.s and the desirability of children of different types and from different localities mixing together, she will refuse her sanction to L.E.A.s establishing boarding schools which are confined to children all of whom arc drawn from the same area.

Miss Wilkinson: The primary duty of a local education authority is in respect of pupils in its own area and, while I do not question the advantages of admitting pupils of different types and from different localities to maintained boarding schools, I am not prepared to lay down a general rule of the kind suggested in the Question.

Mr. King: Would the right hon. Lady consider if local authorities could get together on a regional basis in order to control schools over a wider area?

Miss Wilkinson: They are in process of working out regional arrangements.

Teacher's Appointment, Spennymoor

Mr. Murray: asked the Minister of Education whether she is aware that a qualified teacher, R. Anderson, 26, Craddock Street, Spennymoor, County Durham, has been released from His Majesty's Forces to return to the teaching profession under scheme B, was brought back to this country by air, has been employed nine days and at present is out of a job; and if she will take steps to sec that this young man is engaged at an early date.

Miss Wilkinson: I am aware that Mr. R. Anderson was released under Class B and was appointed as from 5th November to a teaching post under the Durham County Education Authority. He was not on the permanent teaching staff of this authority before he was called up and the post to which he was appointed was only a temporary one, but the authority did not expect when they made the appointment that it would be of such short duration. I understand that he has since been given another teaching appointment in the authority's service.

Mr. George Thomas: Is the right hon. Lady aware that there is increasing need for improving the machinery for letting these Class B release men know where the teaching vacancies are? There is quite a pocket of these people who have been released and cannot get jobs.

Miss Wilkinson: I should like to know where any such pocket is, and if the hon. Member will give me the information, I shall be glad to dip into it at once.

Mr. Thomas: I will do so.

Mr. Murray: Is there any likelihood of this appointment being any longer than nine days?

Miss Wilkinson: I have already said that the gentleman in question has been given another teaching post.

Preparation Classes, West Ham

Mr. Arthur Lewis: asked the Minister of Education whether she is prepared to recognise for grant the remuneration paid to teachers engaged.in supervising preparation classes at the Stratford and Plaistow grammar schools, West Ham.

Miss Wilkinson: Preparation classes, like various other school activities, inevitably entail additional work for the teachers, by whom it is generally accepted as part of their professional employment. I do not feel that I should be justified in recognising for grant special remuneration to teachers in the particular circumstances to which my hon. Friend refers.

Mr. Lewis: Is the right hon. Lady aware that in West Ham there has been a terrible amount of bomb damage and, therefore, the school children cannot do their home work at home, and must of necessity do it in the school? Is it fair that the local councils should have to find out of the local rates £700 a year, bearing in mind the fact that the Board of Education did until March, 1939, make provision for things of this kind?

Miss Wilkinson: I must ask my hon. Friend to take my word for it that we have looked at the matter very sympathetically, but the difficulty is that there is so much work done out of school time by teachers. It is impossible to remunerate most of it and difficult to pick out any local authority.

Rural Areas

Mr. Gooch: asked the Minister of Education if she will ensure for children in rural areas equal opportunities with children in urban areas for a liberal education; and if she will resist pressure for specialisation in agricultural teaching in rural schools, or where such teaching is provided see that it is given in schools specially provided for senior age groups who have decided upon agriculture as a career.

Miss Wilkinson: My policy is to secure equal educational opportunities for town and country children. It will be no part of the function of the secondary modern school to give specialised vocational training for agriculture or any other industry. These schools, whether in town or country, will aim at giving a balanced general education. Farm institutes and the like, which give special training in agriculture for senior pupils, are the responsibility of my right hon. Friend the Minister of Agriculture and Fisheries.

Colonel J. R. H. Hutchison: May I ask the right hon. Lady whether she will consider including in this liberal education, classes of children for instruction in filling up Government forms, which is going to take up so much of their time later on?

Major Legge-Bourke: Will the hon. Lady consider including in the syllabus something of the danger to the nation which arises when the whole country at large ignores the wellbeing of its agriculture, as has happened in the past?

School Canteen, Rackheath

Brigadier Medlicott: asked the Minister of Education if the outstanding points which have been delaying the construction of a school canteen at Rack- heath, Norfolk, have now been disposed of; and if the Ministry of Works have been asked to commence the work.

Miss Wilkinson: No, Sir. The Norfolk County Council will not consent under the Ribbon Development Act, 1935, to the building proposed by their Education Committee, although they state that its removal would not be enforced until the end of the war period. I have informed the authority that I am unable to approve the work unless the county council will undertake to bear the cost of

replacing the building without Exchequer aid if it were demolished before its useful life for school meals had expired but I have not yet received a reply.

Brigadier Medlicott: Is the right hon. Lady aware that this modest project has been under consideration for 2¼ years, and could she not use her influence and, if necessary, her authority to bring it to a head so that these children can have the facilities so lacking in this respect?

Miss Wilkinson: I am worried about it, and we are looking into it.

Far East Internees' Children

Major Sir Jocelyn Lucas: asked the Minister of Education whether she will give any information as to the arrangements made for the continuation of education of the children of civilian internees from the Far East; and what grants are available.

Miss Wilkinson: I have not so far been asked to make grants for this purpose, but I shall be glad to consider any case, details of which the hon. and gallant Member may care to supply.

Training of Teachers (McNair Report)

Mr. Kenneth Lindsay: asked the Minister of Education what steps she is contemplating to make the training of teachers a national charge; what progress has been made in giving effect to the McNair Report; and whether she will establish a central body to assist her in framing a short term and long term policy for the profession.

Miss Wilkinson: It is not proposed that the whole cost of the training of teachers should fall upon the Exchequer as a national charge, but I am proposing to revise the grant regulations so as to secure that the permanent training facilities provided by local education authorities shall be treated as a common service and their expenditure thereon shared appropriately between all authorities irrespective of whether they are themselves responsible for maintaining training colleges or not. As regards the second and third parts of the Question, the recommendations of the McNair Committee, including that for the establishment of a central training council, I am now engaged in the necessary consultations.

Mr. Lindsay: Will my right hon. Friend expedite them? The Report has been out for a year and a half and universities and other bodies are very worried.

Miss Wilkinson: The Ministry of Education has hardly had a passive life for a year and a half with the change of Ministers, which makes some difference to these matters.

Belgian Teachers

Mr. Lindsay: asked the Minister of Education how many of the Belgian teachers selected to teach in English schools have arrived and started work.

Miss Wilkinson: Only one such teacher is at present at work under this scheme. Vacancies have been offered to a number of other Belgian teachers, but these posts have not been taken up.

Mr. Lindsay: Could my right hon. Friend explain why, since these negotiations were started last February, and this is the one country in Europe which can afford to give us facilities, this practical arrangement has not produced more than one?

Miss Wilkinson: I am sorry, but as far as we are concerned we have done everything we undertook to do and we have offered more posts to Belgian teachers than they have been able to take up. We cannot do more, unless they themselves can do more.

Mrs. Leah Manning: Will the right hon. Lady consult with the Home Secretary about some of the Belgian teachers who might be demobilised in this country and would like to teach in this country? I have information about one such teacher, and 1 know of others.

Miss Wilkinson: That is his affair, not mine.

Froebel-trained Teachers

Mrs. Ayrton Gould: asked the Minister of Education if she will amend Clause 12 of Circular 30 issued by her Department to make provision for Froebel-trained teachers who do not hold Certificate A to apply direct to her for approval as qualified teachers, thus obviating the hardship caused when their employing local authorities or governing

bodies are not prepared to put up their cases for consideration.

Miss Wilkinson: While I cannot undertake to make the general change suggested, if my hon. Friend can inform me of any cases which employing local authorities or governing bodies have shown themselves unwilling to put forward, I will gladly make inquiries into them.

Mrs. Gould: Is the right hon. Lady aware that one cannot necessarily have specific information, but there may be great hardship caused by this, and it would be quite easy to allow the individual cases who have applied for consideration, thus preventing the hardship?

Miss Wilkinson: The hon. Lady will understand that we should get hopelessly at cross purposes if we corresponded with individual teachers as to salaries and conditions behind the backs of their employers. If there are individual teachers who, as a result of this Question, would like to communicate with me, I will communicate with their employers as to why their names have not been put forward.

COASTAL RESORTS(ASSISTANCE)

Mr. Channon: asked the Prime Minister whether he will make a statement as to the action which it is proposed to take with regard to the requests made to the Lord Privy Seal recently by a deputation from 51 coastal resorts in former defence evacuation areas.

The Prime Minister (Mr. Attlee): The position of the coastal resorts in former defence evacuation areas affects a number of Departments, and my right hon. Friend the Lord Privy Seal agreed to hear the views of the local authorities concerned. Since then, he has seen a deputation of the hon. Members from these areas and has undertaken to discuss their claims with the Ministers concerned.

B.B.C. CHARTER

Mr. Janner: asked the Prime Minister when the present charter of the B.B.C. expires; and whether it is proposed to set up a committee to consider on what terms it is to be renewed.

The Prime Minister: The present B.B.C. Charter expires on 31st December, 1946. The Government have been giving careful consideration to the terms on which the B.B.C. Charter is to be renewed, but it is not yet possible to make a statement on this matter.

Mr. Janner: Will my right hon. Friend say whether it is the intention of the Government to set up a committee or some other body to investigate the whole of the matters relating to broadcasting in this country?

The Prime Minister: That has not been decided yet.

MILITARY SERVICE (ENGINEERING STUDENTS)

Squadron-Leader Donner: asked the Minister of Labour if he is aware that until recent months students have been allowed to complete the course at Lough-borough Engineering College, Leicestershire; that young men of 18 years, completing their course next July, are now being called up for General Service, not as engineers, in the Army; and whether he will defer such calling-up to enable these young men to take their diploma.

The Minister of Labour (Mr. Isaacs): Until this year, students at Loughborough College were deferred in order that they might be allocated, on the completion of their training, to take technical commissions in the Services or important posts in connection with the production of munitions of war. On the termination of hostilities it became desirable to reduce the number of students attending science courses, and accordingly, a proportion of the students at colleges including Lough-borough College were not granted deferment by the Joint Recruiting Board. I regret I am unable to continue the deferment of these young men, but I am arranging to notify the Service Departments of their technical qualifications.

Squadron-Leader Donner: Will the right hon. Gentleman agree that this indifference towards the young men who are on the point of taking their diploma next summer is most unfair?

Mr. Isaacs: I cannot agree with that, because, after all is said and done, there are men in the Services who want to complete their time and get out.

Squadron-Leader Donner: Does not the Minister agree that the lives and the future of these young men are involved?

Mr. Isaacs: No more than those of the men who have already served six years.

Oral Answers to Questions — EMPLOYMENT

Gas Industrial Union

Squadron-Leader Donner: asked the Minister of Labour when the Gas Industrial Union was established; what is its present membership; and whether it has a part in the consultative machinery of the gas industry.

Mr. Isaacs: This union assumed its present name in June, 1945, having previously been known as the National Gas Fitters and Allied Workers Trade Union, but it has been registered with the Registrar of Friendly Societies since 1896. Its present membership is not known. It is not represented on the Joint Industrial Council for the Gas Industry.

Motorcar Industry

Squadron-Leader Segal: asked the Minister of Labour what was the number of men engaged in the motorcar manufacturing industry who were discharged as redundant during the months of August, September, October and November, 1945, respectively.

Mr. Isaacs: I regret that this information is not available.

Squadron-Leader Segal: Has there been any attempt at restrictive production on the part of the heads of the motorcar industry?

Mr. Isaacs: I have no information of that at all.

Domestic Service

Mr. R. A. Butler: asked the Minister of Labour whether he is now in a position to state the Government's conclusions on the Markham-Hancock Report on Domestic Service.

Mr. Isaacs: I have at the moment nothing to add to the reply which I gave to the right hon. Member on 18th October.

Mr. Butler: Is the right hon. Gentleman aware that the failure of the Government to deal with the Report will be widely regretted in many circles in this country as it is of interest to many people? Will


he therefore expedite consideration of this Report and give an assurance that the Government will come to a conclusion at an early date?

Mr. Isaacs: I cannot agree to the first part of the question, namely, that the Government have failed to deal with the Report, but I agree with the latter part. It is a matter of great importance, and I assure the right hon. Gentleman that we are pressing forward with the matter as rapidly as we can.

Redundancy, Oxford

Mr. Quintin Hogg: asked the Minister of Labour whether he has considered the protest of the employees at Morris Radiators, in which they express concern over the recent redundancy in the Oxford area; and whether he will make a statement on this matter.

Mr. Isaacs: Yes, Sir. As the reply is rather long I will circulate it in the Official Report.

Following is the reply:

I am informed that the workers' representatives disagree with some of the selections made by the employer of workpeople to be discharged to clear a redundancy at the firm named by the hon. Member. In view of misapprehensions which appear to exist, I should explain that, under the procedure for clearing redundancies agreed by both sides of industry, officers of my Department consult the management and workers' representatives with a view to obtaining their full co-operation in operating the release arrangements. These arrangements provide for my officers, in the first place, to select workers in certain clearly specified categories which include men required for call-up to His Majesty's Forces.

If, after this selection has been completed, further discharges have to be made to clear the redundancy, the responsibility of my officer is limited to asking the management to nominate the balance indicating that in selecting nominees the management will no doubt be guided by any relevant industrial agreements to which they may be a party. He has also to make it clear that, in the ordinary way, the permission of the national service officer will be required before the individual workers may be discharged. While this is the limit of the responsibility which my officers have at this stage of the pro-

cedure they are, of course, always available to assist, on request, as for instance by ascertaining the view of the workers' representatives on the nominations made by the management. If any worker nominated by the management is aggrieved, he may make representations to the national service officer in the ordinary way, and retains the usual rights of appeal to a local appeal board.

Eire Workers (Allowances)

Major John Morrison: asked the Minister of Labour why lodging allowances and cheap travel vouchers are still available to workers in this country who have come from Eire, and when these increments on their wages will cease.

Mr. Isaacs: Facilities of this kind provided by the Ministry are the same as for British workers temporarily employed on important work away from their homes, and I see no reason at present to withdraw them from Eire workers when they are still needed for such employment in this country.

Major Morrison: Can the right hon. Gentleman give any indication of the total cost?

Mr. Isaacs: It is in the next Question.

Directed Workers (Allowances)

Major J. Morrison: asked the Minister of Labour the total outlay for the past three months on lodging and other allowances paid to directed workers.

Mr. Isaacs: For the three months ended 31st October, 1945, the most recent period for which complete figures are available, the sums paid by my Department on grants and allowances for workers transferred to employment away from home amounted to £1,076,987. A separate figure cannot be given for workers transferred by compulsory direction.

National Wages Policy

Mr. Norman Bower: asked the Minister of Labour if he proposes to initiate discussions with the trade unions and employers' associations with a view to formulating a national wages policy in conformity with the Government's policy of industrial planning and the White Paper on employment policy; or


whether wage rates will continue to be settled by collective bargaining in individual industries.

Mr. Isaacs: There is no intention of departing from the existing policy of entrusting the responsibility for wage regulation to the traditional and well-tried system of joint voluntary negotiation.

Mr. Bower: Does the answer mean that the Government exclude the wage factor entirely from the scope of economic planning?

Mr. Isaacs: I would have thought the wage factor was the most important part of these negotiations.

Painting and Decorating (Training)

Major Niall Macpherson: asked the Minister of Labour what is the normal time that ex-Service applicants for vocational training courses in painting and decorating have to wait before being allotted a vacancy on a course.

Mr. Isaacs: I regret that owing to the large numbers applying for training as compared with the available training facilities, there has been delay amounting on the average to some weeks in allocating ex-Service applicants. I am glad to say that facilities are being rapidly expanded and should before long be sufficient to meet all requirements.

Labour Preference (Cutlery Trade)

Major Peter Roberts: asked the Minister of Labour whether, in view of the labour shortage, he will assist the cutlery trade, and particularly its export trade, by placing the cutlery industry on the civilian preference list.

Mr. Isaacs: The export industries are already eligible for labour preference. My officers are always ready to help individual exporters, whether in cutlery or other industries, to obtain their proper share of available labour that may be suitable for their needs. I have been in consultation with my right hon. Friend the President of the Board of Trade concerning possible other measures to build up the labour force of the cutlery industry.

Major Roberts: Is the Minister aware that the cutlery trade needs labour, and all it has got so far from the Government is a working party?

Mr. Bossom: Can the Minister say whether this also applies to paper which is specially manufactured for export, for which they have not been able to get any people at all since the war ended?

Mr. Isaacs: As it happens, I am rather interested in paper, but the Question dealt specifically with cutlery and I cannot deal with paper at the moment. I shall, however, be glad to answer any point which the hon. Member cares to put.

Mr. Jennings: Is the right hon. Gentleman aware that this matter is of serious concern to the City of Sheffield, where there is a great lack of employees in the cutlery trade, and, as my hon. and gallant Friend said, all we have got is a working party?

Mr. Isaacs: But the working party, getting the men out of the Forces, is doing a good job as well.

Labour Control (Government Decisions)

Mr. R. A. Butler asked: " the Minister of Labour whether he is now in a position to state the Government's policy on the control of labour.

Mr. Isaacs: I propose to circulate in the Official Report a full statement of the Government's decision, and will confine myself now to the main principles.
We shall review industries and individual undertakings now within the scope of the Essential Work Orders and decide in which cases it is no longer necessary, from the point of view of production and manpower, to continue this control. Three months' notice of withdrawal will be given in the case of any industry. Both sides of industry should begin now to consider jointly any adjustments that may be necessary in their industrial agreements when the Orders are withdrawn.
The following changes will operate on and from 20th December. In general, direction of labour will be limited to men who are liable for military service, i.e. up to and including age 30, and the direction of women will be discontinued. Similarly the control of engagement whereby labour can only be engaged through a local office of the Ministry of Labour will in general be confined to men, up to and including the age of 30. Existing controls must, however, be retained for men up to age 50 in building and civil engineering, in agriculture and in nursing,
and for women up to age 40 in nursing and midwifery. The controls in nursing will be maintained for six months only. Control under the Essential Work Orders and similar Orders which tie a worker to his employment may require the use of directions in exceptional cases.
In reaching these decisions the Government's aim has been to restore individual freedom as rapidly as possible, but this must be done without peril to the fulfilment of urgent national needs.

Mr. Butler: Is the right hon. Gentleman aware that his statement on the subject of women, at any rate, will give great satisfaction, particularly to those of us on this side of the House who have been pressing this policy upon the Minister for some time? Is he also aware that this statement, which, is very comprehensive, will need very careful study from this side of the House, particularly in its application to the housing programme and agriculture, which I understand are included in it, and that it may well be necessary to discuss it in more detail at a later date?

Mr. Speaker: I must remind the right hon. Member that questions should be kept short.

Mr. Gooch: In view of the conditions of employment in the agricultural industry, will the right hon. Gentleman explain his reasons for tying such a loyal body of workers to such a badly-paid industry?

Mr. Isaacs: The decision of the Government is that there are still vital industries where men must be retained if the work of the nation is to be kept going. We hope that there will be sufficient interest in the industries concerned to prompt them to get together to remove any conditions that are a drawback, and it is preferable that that should be done rather than that we should attempt to do it from outside.

Mr. W. J. Brown: Can my right hon. Friend say anything about the Civil Service (Control of Employment) Order, 1945, which has the effect of imposing the Essential Work Order on public servants?

Mr. Isaacs: I cannot say without notice. The full statement occupies four pages of foolscap, and perhaps the hon. Member may find that his point is covered.

Mr. Brooks: Will the right hon. Gentleman make representations to the Minister of Agriculture with a view to securing that farm workers, after being tied to the industry, will receive a quid pro quo in the form of increased wages?

Mr. Isaacs: No doubt the Minister of Agriculture will. note that question, but I doubt whether he has power to fix wages.

Mr. J. J. Robertson: Will my right hon. Friend take steps to see that agricultural workers in Scotland are not treated differently from agricultural workers in England?

Mr. King: Does my right hon. Friend include employees in garages in his reference to the civil engineering trade?

Following is the statement:

1.The Government have carefully reviewed the need for the continuance of labour controls in the light of present conditions. The country is going through a difficult period of re-adjustment. Many industries now engaged on production for essential civilian needs had to be deprived of large numbers of their workers during the war and are now being steadily built up again. Other industries need workers for the turnover from wartime production to vital civilian production. In spite of the rapidly increasing return of men and women from the Forces there will be for a long time to come an over-all shortage of labour. The Government's aim is to restore individual freedom as quickly as possible, but this must be done without peril to the fulfilment of urgent national needs; in particular we must preserve the existing labour force in our essential industries. We cannot, there fore, remove all controls at once, but we have decided to make a very substantial relaxation now in certain existing controls and to take steps for their subsequent easement and eventual withdrawal. The changes I am about to outline will come into effect on 20th December, 1945.
2.In the main there are two types of control —firstly, the Essential Work Orders and similar Orders for certain industries and services, the main object of which is to preserve the labour force in the essential industries and services; and secondly, the control of engagement and the direction of labour, the main purpose of which is to enable labour to be sent to those industries and services most in need of it.


3. The Government have decided that for the time being the Essential Work Orders must in general be retained, both for men and women, for those industries and services in which it is essential in the national interest to maintain the existing labour force. The effect of this decision will be to withdraw a number of less important industries from the scope of the Orders in the near future.,
4.The various industries at present covered by Essential Work Orders will be reviewed and, where it is decided that it is no longer necessary from the point of view of production and manpower to continue this control the organisations representing both sides of the industry will be informed that the industry will be with drawn from the scope of the Orders. It is intended to give three months notice of withdrawal. Certain features of the Essential Work Orders may have proved themselves to be of mutual advantage to employers and workers; also they may have affected the industrial agreements of the industry. The two sides of any industry covered by these Orders will be well advised to consider jointly any re adjustments in their industrial agreements that may be needed to meet the changed circumstances when the Orders are with drawn. Individual undertakings within an industry covered by the Orders will be descheduled in the ordinary way as this becomes appropriate in the changing circumstances.
5.As to the second type of control, namely, the control of engagement of and the direction of labour, the principle which the Government have decided to follow is to limit control, subject to certain exceptions, to those classes of per son who for the time being are being called up for military service.
6.In accordance with this decision directions will in future not be given to women of any age, with the exception of nurses and midwives to which I will refer later, and in exceptional cases for the purpose of making effective the Essential Work and similar Orders. Also we shall discontinue forthwith the system of registering women under the Registration for Employment Order as they reach the age of eighteen.
7.Subject to the exceptions to which I will refer in a moment, the use of directions in respect of men will be limited to those up to and including the age of 30,

which is the present maximum age of call up to the Armed Forces. When the age of call up is lowered, the age up to which directions are used will be correspondingly lowered. This power of direction will be further limited by using it only to meet the special needs of a few industries and services which are identified from time to time as having high priority.
8.Similarly the Control of Engagement Order, which requires that labour should be engaged only through a Local Office of the Ministry of Labour or other approved agency, will, subject to one or two exceptions, in future apply only to men up to and including the age of 30 and not to women of any age. In addition, the present ban on employers in seeking to engage workers by Press advertisement or otherwise will be removed, though employers must still make the engagement through a Local Office of the Ministry of Labour or approved agency in the case of persons still subject to the Control of Engagement Order. This general age limit of 30 will be lowered when the call up age is lowered.
9.Now I come to the exceptions. The first exception is the Building and Civil Engineering Industries which present a special problem, because it will be essential for some time to come that the highest possible proportion of their labour force should be employed on the Housing Programme. We have therefore decided that the power of direction must be retained beyond the age of 30 in respect of men in these industries up to the age of 50. In general men will not be required to take jobs away from home and directions will be spread as evenly as possible so as to minimise inconvenience to indiviual contractors. Control of engagement for men up to 50 within these industries will also be retained.
 10.The next exception is agriculture. In view of the urgent need to retain experienced workers in this industry, we propose to retain for agriculture the present arrangement whereby no man up to and including the age of 50 whose normal employment is in agriculture may take a job outside agriculture except through an Employment Exchange, and that no employer may engage such a man for work other than agriculture except through an Employment Exchange.


11.The House is well aware of the extreme shortage of nurses and midwives. The Government are taking various measures to meet the situation which have been agreed with representative organisations in the hospital services. It will take time to give effect to the agreed measures and to make other necessary adjustments and during the next six months the nursing resources which are available must be used to the best advantage. We propose for this period of six months, but no longer, to retain for use, as necessary, the existing power of direction and control of engagement of nurses and other persons who have had more than one year's recent nursing experience, and of midwives. These controls will apply as at present up to and including the age of 40 (50 in the case of male nurses) and the object will be to ensure as far as possible that nurses and midwives are distributed between the various health services according to need. The retention of the controls for the six months will not, however, interfere with the scheme of release, details of which will be announced shortly, for the Civil Nursing Reserve.
12.The Merchant Navy and the Trawler Fishing industry and the Dock industry have special arrangements where by engagements within the industry are controlled and these will continue.
13.The control under the Essential Work Orders and similar Orders cannot be made effective without the use in exceptional cases of the power of direction in order to ensure that men and women of any age in employment subject to control remain there.
14.Men and women released from the Services in Class B are required to take employment in the occupation and the industry for which they were released. Up to now most of them have been directed under Defence Regulations to a particular job. The general change in labour controls will apply to them as it does to civilians and they will not be directed to their civilian work except in circum stances in which a civilian would receive directions. Men and women who are nominated by their employers for release in Class B will be required to take the particular job in respect of which their release has been granted. Those who do not comply with the conditions on which their release was granted will be liable for recall to the Forces.

15.I should make it clear that it is the Government's intention that the limited controls which will remain in force should be strictly enforced, if necessary by the institution of proceedings against offenders —whether they be employers or workers. At the same time they will be carefully administered so as to avoid individual hardship. Individual workers covered by the Essential Work Orders may, as at present, apply at any time for permission to leave on personal as well as industrial grounds and there is a right of appeal if permission is refused by the National Service Officers. Similarly employers may seek permission to discharge an individual worker. In the case of directions there will be an opportunity of appeal against a direction to a particular job.
16.In conclusion I wish to emphasise to the House and to the country that in deciding upon these relaxations the Government is relying upon the continued co-operation of men and women in the task of re-building our peace-time life. Workers should not throw up the jobs they are doing unless there is very good reason. For a long time to come there will be an acute labour shortage and we shall need the services of every man and woman who can stay at work. I appeal particularly to the women not to with draw or withhold their services. They have done a splendid job during the war and we need their help just as much now. I appeal also to employers to make the best and most economical use of the labour available. It is in their own interest and in the national interest that skill and experience should not be wasted. Again, while it is no longer obligatory upon the majority of men and women to take their employment through the local offices of the Ministry of Labour they will be well advised to do so. The employment exchanges, the appointments offices and the technical and scientific register have available detailed information as to opportunities of employment and as to the relative importance of the various jobs from the point of view of the national interest. They can give advice both to the worker on the choice of a job and to the employer on the labour available and it is in the interest of all concerned that this service should continue to be fully used.

Five-Day Week

Dr. Barnett Stross: asked the Minister of Labour whether he has any avail-


able data as to the effect on industrial production of a five-day week; and whether he is aware that it is desirable that Saturday morning work should be abolished as being wasteful.

Mr. Isaacs: The advantages and disadvantages of the five-day week have been reviewed from time to time in the Annual Reports of the Chief Inspector of Factories. The question whether the abolition of Saturday morning working in a particular industry or establishment is desirable is a matter for negotiation between the employers and workers concerned, in the light of their expert knowledge of all the relevant circumstances.

Works Committees

Dr. Stross: asked the Minister of Labour whether he intends that works committees should be established in every factory employing more than 10 workers; and whether, in view of the excellent results achieved by existing works' committees, he will consider making their establishment obligatory.

Mr. Isaacs: No, Sir. The establishment of works' committees and similar bodies is a matter for voluntary arrangement between the employers and workers concerned, on whose mutual desire and good will they finally rest. It is my policy to encourage the establishment of such machinery, but compulsion would be likely to defeat its own object.

Dr. Stross: Is my right hon. Friend aware that in every case where they have been established production has improved, and conditions for the workers have likewise improved, and, in view of that fact, would he not reconsider his answer?

Mr. Isaacs: No, Sir. If we were to step in and attempt to compel the establishment of these committees, we might get a result exactly the reverse of what we desire.

Captain Blackburn: Is not the association of the workers with the processes of production an indispensable feature of Socialism, and.would not my right hon. Friend, therefore, give urgent consideration to the encouragement of joint production committees throughout industry?

Mr. Isaacs: I think that all possible advice and assistance are given by the

Ministry to the workers' organisations, who are themselves very keen to see the project carried out.

Building Labour (Scotland)

Mr. Gilzean: asked the Minister of Labour whether he is aware that in Scotland men supplied to building contractors to enable them to fulfil their housing contracts for local authorities are being used for other purposes; and will he take steps to ensure that the firms concerned use the men for the purpose for which they are provided.

Mr. Isaacs: No, Sir; but I will look into any such cases if my hon. Friend will let me have particulars.

Manpower Distribution

Mr. A. Edward Davies: asked the Minister of Labour whether he will publish a monthly report showing the number of workers employed in each industry and trade.

Mr. Isaacs: A statement is being published each month showing the changes in the distribution of manpower, including separate figures of the expansion of employment in home civilian industries and services and manufacture for export. I propose also to publish each month in the "Ministry of Labour Gazette "a statement giving the available information as to the number of persons employed in each industry.

Mr. Bossom: Would the Minister give a list of those who are unemployed as well as those who are employed?

Mr. Isaacs: The figures of unemployed are published periodically.

Oral Answers to Questions — DEMOBILISATION

Agricultural Workers

Squadron-Leader Sir Gifford Fox: asked the Minister of Labour (1) in what proportion the additional 10,000 men to be released under Class B for agricultural work are to be released from each of the three Services, respectively; whether any instructions are being issued with regard to their distribution throughout the country; and how many men will be released during the next three months, respectively;


(2) whether, to ensure an immediate and effective response to his purpose for a block B release of 10,000 agricultural workers, he can give an assurance that men so released will not be compelled to work out of range of their present homes or in districts other than those of their own choice.

Mr. Isaacs: Of the 10,000 men who are being released in Class B for agricultural work, it is anticipated that approximately 1,100 will come from the Royal Navy, 6,700 from the Army and 2,200 from the Royal Air Force. Every effort is being made to effect the whole of the releases as quickly as possible. Save in exceptional circumstances, men who accept Class B release to agriculture will be placed by the Ministry of Labour and National Service after consultation with agricultural executive committees, either with their previous employer or on another farm near their homes. Every effort will be made to place the men on the farms to which they desire to return.

Sir G. Fox: Can the Minister give any indication of the date when these people will be released?

Mr. Isaacs: It all depends on where they are at the present moment. Those who are near home will be released early, whereas there will obviously have to be some delay in regard to those who are overseas.

Mr. Turton: Is the right hon. Gentleman aware that 10,000 will not be sufficient, and will he increase the number to 20,000?

Mr. Isaacs: I hope other steps will be taken to deal with that, but at the moment I can only deal with the question relating to 10,000.

Viscount Hinchingbrooke: Is there any qualification attached to these men or are they ordinary agricultural labourers?

Mr. Isaacs: I am dealing with that subject in another Question.

Mr. Turton: asked the Minister of Labour whether, in order to expedite the release of agricultural workers, he will obtain from the W.A.E.Cs. the names of men for whom application has already been made and been turned down by them.

Mr. Isaacs: No, Sir. The agricultural workers to be offered release in Class B

will be selected by the block release method and not by the nomination of individuals. Releases would not be expedited by taking the action suggested by the hon. Member.

Air-Commodore Harvey: Will preference be given to milkers and stockmen whose categories are the most short at the present time?

Mr. Isaacs: The next Question deals with that point.

Mr. Turton: asked the Minister of Labour whether he will now specify the agricultural occupations in which 10,000 men are to be released from the Services under Grade B block release procedure; and the numbers in each occupation.

Mr. Isaacs: I had intended to circulate a statement in the Official Report, but in view of the interest in this matter I will give the details now. The 10,000 men will be made up as follows: General farm workers, 4,000; Market garden workers, 250; Shepherds, 150; Cattlemen, stockmen, yardmen, dairymen, 2,000; Carters, horsemen, ploughmen, 2,000; Agricultural machine attendants, tractor drivers, threshing machine attendants, 200; Farm or market garden labourers, 1,000; Rural craftsmen, 400 (by nomination); Total, 10,000.

Mr. Turton: Will there be any priority to these different occupations, or will they all be released at once?

Mr. Isaacs: We hope we shall be able to release them so rapidly that the question of priority need not arise.

Industrial Service

Major Conant: asked the Minister of Labour whether he has any statement to make in regard to members of the Armed Forces on indefinite release to industry; and whether he is aware that many of those who have received an unqualified written assurance that their period of re lease would count as service towards their current engagements, have been informed by their record offices that they are to remain subject to direction by the national service officer after their release group number has been demobilised.

Mr. Hastings: asked the Minister of Labour when and under what conditions Servicemen, released under the Essential Work Order, will be demobilised.

Mr. Isaacs: I will answer these Questions by asking the hon. Members to await a statement which I will make early next week.

Major Conant: Does the right hon. Gentleman appreciate that a large number of the men concerned. belong to release groups that have already been promulgated, and that therefore a very early statement is necessary?

Mr. Isaacs: I hope to make it very early next week.

Dentists

Major Gates: asked the Minister of Labour whether he is now in a position to increase the quota of Class B releases which may be allocated by the Dental War Committee.

Mr. Isaacs: This matter is at present under consideration.

Oral Answers to Questions — NATIONAL FINANCE

Income Tax (Car Allowance)

Squadron-Leader Segal: asked the Chancellor of the Exchequer what percentage depreciation has been assessed by his Department for Income Tax allowances on a new motorcar purchased in 1939, for the years 1940, 1942, 1944 and 1946, respectively.

The Financial Secretary to the Treasury (Mr. Glenvil Hall): From 1940 to 1945 wear and tear allowances for Income Tax on motorcars have normally been computed at 20 per cent. of the written down value with an additional allowance equal to one-fifth of that amount. For 1946 the normal rate will be 25 per cent. of the written down value with no additional allowance.

Copper Coins

Mr. Grey: asked the Chancellor of the Exchequer if his attention has been drawn to the shortage of copper coins throughout the North-east, causing embarrassment to shopkeepers and public alike; and if he will take steps to alleviate this shortage.

Mr. Glenvil Hall: No recent complaints to this effect have reached my right hon. Friend. 114 million pennies have been issued since October, 1944.

Mr. Murray: Is the hon. Gentleman aware that there are great complaints in

Durham about a shortage of coppers, and that even in the county mental hospital they can scarcely carry on for want of coppers?

Mr. Hall: I understand it is quite a common thing at this time of the year, round about Christmas, for certain localities to find themselves short, but I can tell my hon. Friend that coppers are now being turned out at the rate of £6,000 worth a week.

Gold Purchase

Mr. Stokes: asked the Chancellor of the Exchequer how much gold has been purchased on behalf of His Majesty's Government through the Exchange Control Fund since 1st April, 1940, or other near date.

Mr. Glenvil Hall: My right hon. Friend is not prepared to publish details of these operations.

Mr. Stokes: As this matter has much bearing on the Debate now in progress in the House, may I ask my hon. Friend whether I would be grossly in error in supposing it is of the order of £400,000,000 sterling?

Mr. Hall: I am sorry, but I cannot add to the reply which I have given on behalf of my right hon. Friend the Chancellor.

Mr. Stokes: That is what it is.

Requisitioned Property (Compensation)

Major N. Macpherson: asked the Chancellor of the Exchequer whether he will authorise the Ministries to make allowance when calculating compensation for damage to requisitioned property to include a sum representing the rates payable from the time of derequisitioning to the time when it may reasonably be presumed that the property can be restored to a proper state of repair.

Mr. Glenvil Hall: No, Sir.

Major Macpherson: In view of the extreme delay that takes place before a house or building can be put in good order, will not the hon. Gentleman review this matter, as if bears particularly hardly on agriculture and industry?

Mr. Hall: We realise the difficulty, and if we could we would like to help to meet it, but the method suggested by the hon. and gallant Gentleman is not the right


method, and it would go across the general principle which is at the moment well embedded in the law.

Purchase Tax (Motorcars)

Lieut.-Colonel Lindsay: asked the Chancellor of the Exchequer if he has yet formed an estimate as to what the yield from the Purchase Tax on motorcars would be in the full year 1946.

Mr. Glenvil Hall: No, Sir.

BANKS (CHRISTMAS EVE)

Mr. Lipson: asked the Chancellor of the Exchequer if, in view of the fact that Government Departments will be closed on Christmas Eve, he will authorise the closing of banks on that day.

Mr. Glenvil Hall: No, Sir. My right hon. Friend agrees with the proposal of the banks that they should remain open until 12 noon to meet the needs of those working on Christmas Eve.

TELECOMMUNICATIONS CONFERENCE (REPORT)

Sir Arnold Gridley: asked the Chancellor of the Exchequer whether, for the information of Members of Parliament and others, he will authorise the publication of the Report of the Commonwealth Telecommunications Conference held in July last under the chairmanship of Lord Reith.

Mr. Glenvil Hall: No, Sir. His Majesty's Government do not consider it would be in the public interest and have every reason to believe that their view is shared by the Dominion Governments.

LOCAL GOVERNMENT OFFICERS (PENSIONS)

Dr. Little: asked the Financial Secretary to the Treasury whether he will consider removing the means test imposed upon local government officers by the Pensions (Increase) Act, 1944, in view of the fact that no such test is imposed upon civil servants claiming under the Act.

Mr. Glenvil Hall: The two provisions mentioned were designed to meet entirely different circumstances. The future of the Pensions (Increase) Act, 1944, is at present under review.

Dr. Little: When this matter is under review, will the hon. Gentleman give favourable consideration to these pensioners and place them on the same level as civil servants?

Mr. Hall: I cannot, of course, prejudice by any statement now what will be the result of the inquiry, but I will tell the hon. Gentleman that this matter is under sympathetic review, and we hope in the New Year to be able to make some announcement.

Mr. W. J. Brown: Can the Financial Secretary give any estimate of the time in the New Year when he will be able to make a statement?

Mr. Hall: Not at the moment.

TELEPHONE SERVICE

Wing-Commander Cooper: asked the Assistant Postmaster-General how soon now does he anticipate being able to replace the shortage of operators which causes delay in the toll and trunk telephone services; and when does he propose to restore the cheap trunk call rate now in force between 6.30 and 9.30 p.m. to the whole night period as previously.

The Assistant Postmaster-General (Mr.Burke): Although the recruitment of telephone operators has improved considerably during the past few weeks, the volume of traffic is also rising, and I am not yet able to say when the shortage will be made good. In London, where the shortage is most acute, the Post Office is now recruiting and training new operators at the rate of about 200 a week —a net increase of approximately 100 operators a week. The release from the Forces in Class B of about 300 female telephonists has been agreed by the Ministry of Labour and National Service, and my Department has approached the Ministry for the release in Class B of all male night telephonists. I am hopeful, therefore, that the recent improvement in the staffing position will be maintained and that still further improvement will be shown after Christmas.
With regard to the second part of the Question, no extension of the cheap trunk rates beyond 9.30 p.m. can be considered until the existing shortage is made good, and until there are sufficient trained men available to cope with the additional traffic which would be attracted.

Wing-Commander Cooper: Does not my hon. Friend think that an improvement in the public services of his Department would give great encouragement to those who believe in the efficacy of various forms of nationalisation?

Mr. Bossom: Can the hon. Gentleman state whether the service is paying for itself this time, or whether it is getting a subsidy from some other source?

Lieut-Commander Braithwaite: Will the Minister now resume the system of publishing the telephone and telegraph accounts?

LEVANT STATES (ANGLO-FRENCH AGREEMENT)

Mr. Eden: (by Private Notice): asked the Secretary of State for Foreign Affairs whether he has any statement to make on the progress of conversations between His Majesty's Government and the French Government in respect of Syria and the Lebanon?

The Secretary of State for Foreign Affairs (Mr. Ernest Bevin): I am very glad to be able to inform the House that we have reached agreement with the French Government on the subject of the joint withdrawal of French and British troops from the Levant States. The following statement, which is being issued by His Majesty's Government and the French Government summarises the agreement reached:
" The exchange of views relating to Levant and Near Eastern questions which took place between Mr. Bevin and M. Bidault last September on the occasion of the Five Foreign Ministers' Conference, have since continued through the diplomatic channel. Carried on in a spirit of friendship and mutual confidence, these discussions have just resulted in an Agreement on the various aspects of the problems under consideration.
" Inspired by the desire to eliminate in a lasting manner all differences of policy capable of prejudicing their respective interests, and damaging the good understanding which they propose to make even closer, the two Governments have recognised that it was in their joint interest to encourage, within the framework of international collaboration, the economic well-being and security of the peoples of the Middle East.
"Moreover, equally desirous of assuring to Syria and the Lebanon the full exercise of the independence proclaimed by France in 1941 and consecrated by the admission of these States into the United Nations, and in the wish to draw the natural conclusions arising from the end of hostilities with regard to the Allied military dispositions in the Levant, they have decided jointly to examine the conditions for a methodical re-grouping and withdrawal of their military forces in this zone.
" British and French military experts will meet for this purpose at Beirut on 21st December, 1945. One of their essential tasks will be to fix a very early date for the first measures of evacuation."

Mr. Eden: May I ask the right hon. Gentleman to accept for himself and for those who work with him our congratulations on this important step towards a solution of a vexing problem? May I add that I feel sure it will be applauded by the House as removing an obstacle to friendship between ourselves and our French friends and neighbours, and that also no doubt it will be warmly welcomed in Syria and the Lebanon?

BUSINESS OF THE HOUSE

Mr. Eden: Before asking the Leader of the House about the Business for next week, can he tell us anything about the arrangements for today?

Mr. H. Morrison: The original arrangement about today was that the general Debate on the Motion would terminate at about 7 or 7.30 p.m. and that we would then proceed with the Motion for the Second Reading of the Bretton Woods Bill. Representations have been received to the effect that as the Debate on the Second Reading of the Bill will inevitably be limited, it would be more convenient if the general Debate on the Motion continued somewhat longer. Therefore, it is proposed that the Division on the Motion should be taken at 9.15 p.m. and that then the Second Reading of the Bill would be moved, on the understanding, if this is done, that the Debate on the Second Reading, which will inevitably be limited in scope, would also be limited in time, and that we could get the Second Reading at an early hour. I gather that would meet the general convenience of the House.

Mr. Boothby: I would like to ask first, in respect of the answer just given, what the right hon. Gentleman means by "an early hour," and why he should say the Debate on the Bretton Woods Bill should be so limited in scope. It is a complicated Agreement, and a great many questions require to be asked and answered about it before a decision can be given. I would like to know what the right hon. Gentleman means by his reference to ending the Bretton Woods Debate at an early hour, because some of us are very anxious to put certain very important questions to the Government before we give a Second Reading to this vital Measure.

Mr. Speaker: Perhaps I had better answer that question. It must be perfectly obvious to the House that if it has passed a Motion welcoming the Bretton Woods Agreement, then, the Bretton Woods Agreement having been accepted by the House, discussion of it will be out of Order on the Second Reading of the Bill.

Mr. H. Morrison: On the other point of the hon. Gentleman's question, I should have thought that in those circumstances, we ought to get the Division on the Bill by about 11 o'clock. It would be a pity to take a Division later, and I hope the House will be willing to have the Division on the Second Reading not later than 11 o'clock.

Mr. Boothby: May I submit, with all due humility, that a number of hon. Members yesterday deliberately refrained from discussing the Bretton Woods Agreement, because we understood that Agreement would be open for discussion on the Second Reading of the Bill? It is an extremely important Bill, on which the Congress of the United States have spent four months examining it in every detail. On a point of Order I submit it would be an outrage if this House were asked to pass this Bretton Woods Agreements Bill, which is a vital Bill affecting the whole future of this country, without discussion.

Mr. Speaker: The House must abide by the Rules of Order. It is perfectly clear that the House having accepted the Motion, the Bretton Woods Agreement cannot be discussed after that. Once the Motion has been accepted, the House cannot discuss what it has already approved. Therefore, I have no hesitation

in saying that it will be out of Order to discuss the Bretton Woods Agreement on the Second Reading of this Bill.

Mr. H. Morrison: I am in the hands of the House. I want to meet their wishes, but if the general Debate is to be continued until 9.15 p.m., in order that wider issues may be discussed, then I think it is a little ungracious on the part of the hon. Member for East Aberdeen (Mr. Boothby) to be strict about the Second Reading unless he wishes the Division on the Motion to be taken earlier. In that case I do not mind; it can be taken at 7 or 7.30.

Mr. Speaker: I deliberately ruled as I did yesterday, in order that the House might discuss the Bretton Woods Agreement on the Motion without restriction of anticipation inspired by the Bill. It is perfectly clear that discussion of the Agreement is out of Order on the Second Reading of the Bill once the Resolution has been passed.

Sir John Mellor: May I, with the greatest respect, put a comparable case? We have discussions on the Budget Resolutions and we then have further discussion on the various stages of the Finance Bill, Is this not comparable?

Mr. Speaker: No. I am not of that opinion.

Mr. Bowles: On a point of Order. I realise what are the Rules of Procedure as regards trying to extend a Motion, of which notice has been given on the Order Paper. I see the Prime Minister has put down a Motion to exempt indefinitely from the Rule the Second Reading of the Bretton Woods Agreements Bill. Is it not in Order, should the Government deem it wise, to move a Motion, of which they have not given us notice, to suspend the Rule for two hours on the Motion covering the Bretton Woods Agreement?

Mr. Boothby: Further to my hon. Friend's point of Order. As I understood, Mr. Speaker, you said, yesterday:
 According to the rule against anticipation, the fact that the Bill is before the House would prevent reference to it in the course of the Debate on the Motion. Since however, the sole purpose of the Bill is to implement some of the provisions of the Bretton Woods Agreement it would prove a very inconvenient restriction on what was intended to be a comprehensive Debate if all


reference to that Agreement were excluded."— [Official Report, 12th December, 1945, Vol. 417, c. 422.]
I beg to draw your attention to the fact that that could only be interpreted as a concession on your part, that in the course of the Debate yesterday, reference could be made to the Bretton Woods Agreements Bill for the convenience of the House, but you gave no indication that you were going to rule out all Debate on Bretton Woods on the Second Reading of the Bill.

Mr. Speaker: I did not think it was necessary. I made the concession in order to enable hon Members to take part in the discussion of the Bretton Woods Agreement, on the Motion, without fear of the risk of anticipation.

Mr. Bowles: May I have an answer to my point of Order?

Mr. Speaker: Does the hon. Member wish to limit the Motion or amend it?

Mr. Bowles: With respect, Mr. Speaker, you have not answered my point. I know I am not allowed to limit a Motion of which notice has been given on the Order Paper. There is no notice, so far as the continuance of the Debate on the Motion that will shortly be before the House, is concerned. Would the Government consider suspending the Rule for two hours on that Motion, apart from moving any other Suspension Motion?

Mr. H. Morrison: The Government are being most considerate, indulgent, tolerant and kind to everybody, but we cannot go any further than we have gone.

Mr. Stokes: On a further point of Order. I find myself in some difficulty and probably, if I may say so with all respect, I am not the only one. The other day I asked whether, supposing an hon. Member was fortunate enough to catch your eye, Mr. Speaker, in the course of the Debate which we are about to resume, that would make it very unlikely that he would catch your eye on the subsequent Debate on Bretton Woods. You replied that you hoped hon. Members would not make two speeches. Later, you went on to explain that a certain discretion would be allowed, because it would be more convenient to the House as a whole. With great respect, you did not indicate that the Motion on the Order Paper would preclude dis-

cussion of the Bretton Woods Bill. I really do not understand it, and I want to understand it.

Mr. Speaker: There are certain matters which can be discussed on this Bill, but not on the Bretton Woods Agreement.

Mr. Stokes: Yes, I see.

Wing-Commander Cooper: I know ignorance of the law is no defence, but I would suggest with respect, Mr. Speaker, that your remarks of yesterday would not have been taken by some new Members of the House to indicate the interpretation which you have now given.

Mr. Speaker: The hon. and gallant Gentleman does not really understand what I meant to say. All the speeches yesterday would, clearly, have been out of Order, unless I had made that announcement. I made it deliberately so as to bring the speeches within the Rules of Order.

Wing-Commander Cooper: The point is, Mr. Speaker, that we all thought there would be a further opportunity on the Second Reading of the Bill to address remarks to the House on this subject.

Mr. Speaker: Yes, I am sorry about that. Perhaps to hon. Members who have only been a short time here, this demonstration might be a good education.

Mr. Eden: May I ask the right hon. Gentleman the Leader of the House if he can tell us the Business for next week?

Mr. H. Morrison: Yes, Sir.
On Monday, 17th December, we propose to take the Committee stage of the Bank of England Bill and a Motion to approve the Potatoes (1945 Crop) (Charges) Order, 1945.
Tuesday, 18th December— Report and Third Reading of the Statutory Instruments Bill and of the Building Restrictions Bill; Second Reading of the India (Proclamations of Emergency) Bill [Lords] and a Motion to approve the continuance in force of the Government of India Proclamation relating to Orissa.
Wednesday, 19th December—Report and Third Reading of the Bank of England Bill and a Motion regarding proceedings of the House in Secret Session during the war period. The Government have come to the conclusion that it is no


longer necessary on security grounds to maintain the secrecy of proceedings in Secret Sessions of the House during the war. Mr. Speaker, whom we have consulted, informs us that there is no objection as far as he is concerned. The necessary Resolutions will be put down today, and we hope that it may be possible for the House to take them on Wednesday. They will include an order for the reprinting of the Report of the Committee of Privileges, presented on 23rd June, 1942.
Thursday, 20th December—Motion for the Christmas Adjournment until Tuesday, 22nd January, 1946.
During the week we shall ask the House to consider Lords Amendments to the Statutory Orders (Special Procedure) Bill, the Police (Overseas Service) Bill, and Amendments to any other Bills which may be received from another place.
We shall also ask the House to agree to the appointment of a Select Committee to consider the validity of the elections of certain hon. Members who may have held disqualifying offices at the time of their election.
As is usual on the day of Adjournment for a Recess, it is proposed to meet on Thursday, 20th December, at 11 a.m. Questions will be taken until 12 noon, and Mr. Speaker will be empowered to adjourn the House, without Question put, at 5 o'clock.

Mr. Eden: Might I ask in reference to Wednesday's Motion about the proceedings of the House in Secret Session during the war, whether we might have some information about the Government's reasons for this proposal at what may seem to be rather an early stage?

Mr. Morrison: I think that is a very reasonable request and certainly the Government spokesman will give reasons why we think the time has arrived when this step should be taken. It may be that then, some other views will be expressed.

Mr. Clement Davies: May I ask whether the right hon. Gentleman can tell us what arrangements have been made for the publication of the Report of the Select Committee of this House which would ordinarily have been published in the Proceedings of the House?

Mr. Morrison: I am not in a position yet to make any statement on that matter.

Mr. Tom Brown: I would like to ask the right hon. Gentleman the Leader of the House when he proposes to implement the promise given some months ago, to bring forward proposals to ameliorate the hardships of old age pensioners.

Mr. Morrison: I thought that was all well understood. There will be a Bill containing provisions as to social insurance generally, on a national basis, and it is hoped that that Bill will shortly be printed.

Sir Wavell Wakefield: Several weeks ago the House was promised a Debate on civil aviation. Can the right hon. Gentleman say when the White Paper will be available and if there is any likelihood of this Debate taking place before the Easter Recess?

Mr. Morrison: I think there is a sporting chance of having it before the Easter Recess. I cannot be quite sure that the White Paper will be available to the House before we adjourn for the Christmas Recess, but it will be ready very soon thereafter. I will try to get it made available before the House adjourns.

Miss Rathbone: As we have had no opportunity of discussing the Government statement on Palestine, though it has been discussed in another place, can we have an assurance that an opportunity for full discussion will be given shortly after the Recess?

Mr. Morrison: I appreciate the point which the hon. Lady has raised, and we will certainly do our best.

Mr. R. A. Butler: Could the right hon. Gentleman say when the National Insurance Bill will be made available to Members?

Mr. Morrison: I cannot be sure, but I hope it will be before the Houses rises. In any case, I hope that the Bill will be available in dummy, so that the text may be available shortly afterwards.

Mr. Silverman: On the question of Palestine, on the occasion when the Home Secretary made the announcement, by general agreement on both sides a great many people refrained from asking questions which obviously might well


have been asked, on the definite understanding that full opportunity would be given for debate. I can appreciate the right hon. Gentleman's difficulties but will he not assure the House now that an early opportunity will be taken to allow the House to debate it before the Commission has reached an advanced stage?

Mr. Morrison: I am very grateful to the House for the restraint which was exercised on all sides, but, of course, our programme has been interfered with by the Motion of Censure and by the Debate on the Anglo-American financial and economic discussions.

Mr. Oliver Stanley: May I ask the right hon. Gentleman if opportunity will be given to discuss the constitutional changes in Ceylon early in the New Year?

Mr. Morrison: There are so many things to discuss in the New Year that I am afraid not, unless there is a very general desire and there is contention about it. I thought there was general agreement.

Mr. Stanley: I think that there is a general feeling in the House that there should be an opportunity of discharging our responsibilities to the Colonial Empire by discussing the matter.

Mr. Morrison: With great respect, I do not think it was the, general feeling of the House. As far as we can see, there is no disagreement about policy but it was felt it would be right, as a matter of form, to have a discussion. I think the House has much too much to do now in the way of legislation.

Mr. Godfrey Nicholson: Is the right hon. Gentleman aware that many hon. Members have received reports, which appear well founded, of general uneasiness among a considerable minority in Ceylon; and is it not essential that this matter should be discussed, even if only briefly?

Mr. Morrison: That does not accord with our information.

Squadron-Leader Donner: I understood the decision was to be taken tomorrow regarding Bretton Woods. If in fact it is to be taken tonight, with no opportunity of debate, some of us who are rather apprehensive about it will have no alternative but to vote against it.

Mr. Boothby: May I ask the Lord President how he squares the gagging of the House on Bretton Woods, with the repeated undertakings of the Government that we should have a full and free discussion?

Mr. Morrison: If I may say so, that is a perfectly untrue and gratuitous remark. The Government have taken every step to give the House the widest opportunity for discussion of the principles involved, and Mr. Speaker has helped the House too. I think that for the hon. Member to offer mere slogan-making observations of that sort is utterly unreasonable.

INDIA (PARLIAMENTARY DELEGATION)

Mr. H. Morrison: With permission, I desire to make a statement on the proposed Parliamentary delegation to India.
The Government have considered further the character of the proposed Parliamentary delegation to India to which I referred on 4th December. They had originally felt that it would be appropriate for this delegation to go under the auspices of the Empire Parliamentary Association which does most valuable work in bringing into contact parliamentary representatives of different parts of the Commonwealth. Having regard to the views expressed in the House on the use of this particular method in this case and in view of the fact that the Indian branches of the Association are in partial suspense during the dissolution of the legislatures, the Government have now decided to make different arrangements. The delegation will contain representatives from another place, nominated by the Lord Chancellor, and you, Sir, have kindly agreed, if the House so desires, to nominate the Members from this House. The question of the status and functions of this delegation was raised on my earlier statement. I wish to make it clear that the members will go out as representatives of Parliament to make personal contacts to ascertain individual views and to convey to leading Indians the broad general attitude of the chief political parties in this country. The delegation will not be in any sense charged with making an official inquiry, nor will they be asked to make any formal report.

Mr. Eden: I am obliged to the right hon. Gentleman for this modification of the original proposal. Although we are grateful for the valuable work done by the Empire Parliamentary Association, it does seem that this particular mission will proceed better under these auspices.

Mr. Tom Smith: May I take it this change of policy in no way reflects on the policy of the Empire Parliamentary Association to promote unity within the British Commonwealth, both by personal contacts, and the exchange of important information?

Mr. Morrison: I cordially associate myself with what the right hon. Gentleman and the hon. Member have said about the Empire Parliamentary Association. It is a most admirable association, but in the case of this delegation, it was thought, on balance, better to handle the visit in another way.

Mr. John Lewis: Can the right hon. Gentleman give us any idea of the duration of the mission?

Mr. Morrison: We hope it will take place during the Recess, but whether the Members will be able to get back for the date when the House resumes is doubtful.

Earl Winterton: In view of the unfortunate precedent in the case of the Mission to Newfoundland, which afterwards found itself unable to make a report, will the right hon. Gentleman state more clearly whether we are to have a report to the House from this mission? If not, what is the sense of sending it?

Mr. Morrison: I have explained the sense of sending it, and I think that the position is clear. I think it would be wrong to turn this Parliamentary delegation into something like a commission. I think it would be wrong to fetter them, and wrong to require them to make a report to the House on their return. I should hope that on the delegation's return, they would be agreeable, as the Government would wish, to make their views and opinions known, and if it were the desire of the House, I feel certain they would be happy to attend an all-party meeting upstairs in order that they might give information. But I think it would be wrong if we were to convert this Parliamentary delegation into something like a Royal Commission.

Earl Winterton: May I respectfully protest against the proposal of an all-party meeting upstairs? The proper place to report to the House of Commons is in the House.

Mr. Evelyn Walkden: May I ask my right hon. Friend whether he is not aware that a previous delegation which went to China reported to an all-party meeting? This mission, I assume, will go out for fact finding and good will and not fault finding.

Sir Ralph Glyn: May I ask who will make arrangements for this party when it gets to India and will it be able to move about India? Will it be under the Government of India, and is it thought that, in a fortnight, the mission can learn very much about the whole of India?

Mr. Morrison: The services of the Government of India will be at the disposal of the delegation in the matter of an itinerary and transport and so on, but the delegation will be free to go wherever they like, and we trust will exercise that freedom.

Mr. Driberg: Further to the point referred to by the Noble Lord, may we take it that, although the delegation may not be required to present a written report, if they should unanimously desire to do so, they would not be prevented from doing so, as in the case of the Newfoundland mission?

Mr. Morrison: That is a matter we can consider when the delegation return, and, if they wished, they could confer with the Government on the point. I am bound to say that I do not recall a previous delegation of this kind having, as the Noble Lord seemed to imply, made a verbal report to Parliament in full Session,

Earl Winterton: Will there be any opportunity of discussing this matter?

Mr. Morrison: No, I do not think so.

Mr. Pickthorn: I apologise for not getting in sooner, but, if I heard the right hon. Gentleman aright, he referred to this Parliamentary delegation as representative of the Government. I feel sure that that is not correct, and this intervention will give him the opportunity to correct his statement.

Mr. Morrison: With great respect, the hon. Gentleman is, I feel sure, quite wrong. Certainly, it would not be a true statement of the position.

Captain Crookshank: May I ask the right hon. Gentleman upon whom the expenses are to fall?

Mr. Morrison: They will fall upon the Government, and presumably will be taken on the Vote of the India Office.

Captain Crookshank: Then there will have to be a Supplementary Estimate?

Mr. Morrison: I do not know. It depends, but, whether it is on a Supplementary Estimate or the ordinary Vote, if the House wants to discuss it on Supply, it is free to do so. That, however, is not what the Noble Lord meant. He went quite wrong on the precedents.

Mr. Nicholson: Surely, Parliament has benefited considerably from the fact that both Houses have had their contacts with Indian personalities. Surely, it is not necessary to make such heavy weather of it, as some hon. Members do.

EMERGENCY LAWS (TRANSITIONAL PROVISIONS) BILL

Reported, with Amendments, from Standing Committee B.

Bill, as amended (in the Standing Committee), to be considered upon Monday next, and to be printed. [Bill 51.]

Minutes of Proceedings to be printed. [No. 42.]

FURNISHED HOUSES (RENT CONTROL) BILL

Reported, with an Amendment, from Standing Committee C.

Bill, as amended (in the Standing Committee), to be considered upon Tuesday next, and to be printed. [Bill 52.]

Minutes of Proceedings to be printed. [No. 43.]

WATER (SCOTLAND) BILL

Reported, with Amendments, from the Standing Committee on Scottish Bills.

Bill, as amended (in the Standing Committee), to be considered upon Thursday next, and to be printed. [Bill 54.]

Minutes of Proceedings to be printed.[No.43.]

NATIONAL INSURANCE (INDUSTRIAL INJURIES) BILL

Reported, with Amendments, from Standing Committee A.

Bill, as amended (in the Standing Committee), to be considered upon Tuesday next, and to be printed. [Bill 53.]

Minutes of Proceedings to be printed.[No. 45.]

BUSINESS OF THE HOUSE

Proceedings on the Second Reading of the Bretton Woods Agreements Bill and of the Committee on Bretton Woods Agreements [Money] exempted, at this day's Sitting, from the provisions of the Standing Order (Sittings of the House).—[Mr. H. Morrison.]

Orders of the Day — ANGLO-AMERICAN FINANCIAL AND ECONOMIC DISCUSSIONS

Order read for resuming Adjourned Debate on Question [12th December]:
That this House approves the financial arrangements between His Majesty's Government and the Government of the United States, including the final settlement of Lend-Lease and other claims arising out of the war, as set out in Cmd. 6708; welcomes the initiative of the Government of the United States in making ' Proposals for an International Trade Organisation,' Cmd. 6709, and approves the participation of His Majesty's Government in the discussions proposed with a view to arriving at an international agreement upon the basis of the suggestions put forward; and approves the proposals for setting up an International Monetary Fund and an International Bank for Reconstruction and Development as set out in Cmd. 6546 of 1944.

Question again proposed.

Mr. Speaker: Sir Thomas Moore.

Major Peter Roberts (Sheffield, Eccle-sall): On a point of Order, Mr. Speaker. You gave a Ruling that no Amendment to this Motion would be called. Since then, I and certain oilier hon. Members have listened to the Debate very carefully and have come to a conclusion, which we have put down in an Amendment on the Order Paper. The question which I want to ask you, Sir, is this. I am quite certain that we must assent to this loan, taking with it all the difficulties— [Hon. Members: "Order."]

Mr. Speaker: The hon. and gallant Member cannot discuss the Amendment he has put down on the Order Paper. He may only ask a question about it.

Major Roberts: The point is this, Sir. Will there be an opportunity of discussing this Amendment, in order that we can explain freely the vote which we wish to record?

Mr. Speaker: I think the short answer is that I saw the Amendment on the Order Paper and examined it, and that I have not selected it.

3.49 p.m.

Lieut.-Colonel Sir Thomas Moore: I would like to explain my temerity in seeking to take part in this Debate, since I am certainly conscious of lacking any specialised qualifications which all the hon. Members who have spoken previously seemed to possess. I want to make it quite clear that I am not an economist, like the hon. Member for Chesterfield (Mr. Benson), I am not a Social Creditor, like the hon. Member for South Nottingham (Mr. N. Smith), I am not a commercial magnate, like the right hon. Gentleman the Member for Aldershot (Mr. Lyttelton), and I am not anti-gold, like the hon. Member for East Aberdeen (Mr. Boothby). In fact, I am speaking as a man in the street, for the common citizens of this country, with no political complex, no inhibitions, anti-nothing, as the men of Britain generally are, except when there is a shortage of beer. I am, indeed, even speaking for the charlady who so kindly and competently cleans my flat, and who said to me yesterday morning, "We are accustomed to hardships, we are used to hardships. Tell those gentlemen in the House of Commons to stand up for Britain and not trail after the Americans and their spam." I believe that those are the views held by the majority of the people of this country, irrespective of their walk in life.
I was going to introduce certain arguments that bear on the remarks I wish to make, but, in deference to your desire, Mr. Speaker, to call as many hon. Members as possible during this afternoon's Debate, I am leaving aside some very pertinent reflections which I had hoped to make on nationalisation— [Laughter]. Oh, yes, they bear very strongly upon my point of view, but I might add that we simply regard the adventures of the Government in the realms of nationalisation as acts of adolescent effervesence and a natural reaction to their unexpected victory. If advisable and in God's good time, they can be repealed as they have been in other countries. This question, and it is a very grave question, of nationalisation may be affecting our industrial and financial position today, but it cannot be allowed to take up too much


time, for, after all—and this is the essential point—these arc purely domestic measures, and an entirely different thing from the question which is facing us today. These measures which we are discussing today will have fundamental repercussions on the future of Britain as a world Power, and, indeed, on the future of Britain as a member and head of the great community of nations known as the British Empire.
What I want to know is, what is the alleged reason for persuading or forcing us, or even inviting us, to accept this loan and tie it up with the Bretton Woods Agreement, and why are they linked together? The Chancellor gave us two good reasons, in his opinion, and yet he spoke without any sense of conviction, to my mind. He quoted the loss of luxuries, such as tobacco. I hold that we can change our tastes. Turkey and Greece have been trying for the last five years to persuade us to buy their tobacco. Rhodesia and South Africa can fill up the gaps. But the main theme of the Chancellor's argument was that there was no alternative, and that is the note which "The Times" strikes this morning.
I want to ask a few questions. If the United States does not ratify the proposals, have we no alternative? What if Russia refuses to ratify them before 31st December, and Russia may not like being hurried? Is there then no alternative? If so, what a bankruptcy of statesmanship is disclosed. I will give the alternative. I would say—" Drop or postpone this stupid nationalisation fetich; remove the burden of uncertainty from industry; free the export trade from the fetters of forms and restrictions which encumber it; rally our friends in the sterling area, and our creditors, of whom we have many, to our side. Our goodwill is enormous, our credit untarnished, our purchasing power immense, the courage and endurance of our people, the skill and ingenuity of our scientists and engineers and the capacity of our craftsmen are unrivalled. Give them a chance." That is my alternative.
But the American papers give another reason, a rather sinister one. They say that our Government are trying to get this loan in order to pay the inevitable losses on their nationalised services and industries. If that, indeed, be true, it
would be a very heavy price to pay. But what I really want to know is why they should tie this loan up with Bretton Woods. When I first read the report of that Conference, I rashly formed the conclusion that it was merely a useful extension of the prewar sterling area into a world currency area. I also had the impression, not being an economist, that currency had to be tied to or based on something; whether it was gold, or marbles, or shrimps, did not seem to matter very much, except that as marbles are easy to make, and shrimps are easy to catch, gold for many reasons possessed a more stable quality.
I now realise that this was a false analysis, that our currency, since 1931, has had no such basis of gold. It was really based partly on the elasticity of sterling, partly on our national credit, in other words on the faith of the world in British goods, British capacity and British integrity, and because of the unique position which London occupied as an exchange centre. We did pretty well that way and so it seems to me a most arguable proposition whether we should now surrender the benefits of the sterling area—the British integrity area, a very wide and profitable area with good and willing markets— for the doubtful and unknown blessings of this World Monetary Fund. And it does seem to me grossly improper to tie up this Bretton Woods issue with the question whether we shall or not accept this reluctant loan from our friends in the United States.
I would ask also whether this is really a loan, or whether the Government have got it all wrong. In the White Paper, it is persistently referred to as a credit. The American newspapers confirm that, and, if that is so, are we then prevented from spending it anywhere but in the United States? Judging from the United States newspapers, that is obviously their impression. If that is so, what is to pay for these frolics in nationalisation? But, coming back to the terms of this loan, they are very harsh. I think we all agree about that. I do not want to repeat facts that are already known in this country, but memories are short across the Atlantic. They can well remember the bombardment of the Capitol 170 years ago, but they are somewhat reluctant to remember that, for the last century and a half, the British Navy have been the bulwark of their defence.
So I feel we have got to speak out, so that whatever we may say may have its full effect on Congress, and show them that we are not crawling to get this Loan, that we still have certain feelings of dignity and of justice, though apparently they have, for the moment, anyhow, overlooked them. This Loan and its indecently harsh terms take no account of the toil, sweat, blood and tears suffered by us, not only since 1941 but before that, during those terrible years of struggle when the United States were having the time to prepare that Britain was denied. It takes no account of the economic exhaustion— or perhaps it does — which this country has suffered through giving every ounce of its waning energy to save itself and America from disaster. It takes no account of the forgotten factor, one which can never be over-stressed, that Britain was the first great country to wage war not because it was attacked but on account of an ideal which it believed to be right, that nations and individuals should be free to live and work, to pray and play, as they so desire provided they do not harm a neighbour.
This is a purely financial transaction. The Loan, or credit, has to be paid in full. It has to be repaid over a limited number of years, it carries no ungenerous rate of interest and it has to be spent in the United States. This is serious enough but where the British shoe really pinches is on the question of how the conditions accompanying this loan and the Bretton Woods Agreements affect our bonds with the Empire. To my mind that is one of the most fundamental issues. Vague references have already been made to this point in the White Papers. The President of the Board of Trade did his best yesterday to excuse or define these proposals— how they would affect us in the Colonial Empire. He did not convince me. He used his legalistic casuistry in the most persuasive way, but still that phrase "eliminating preferences "struck a cold chill to my heart, and not even his most persuasive language could remove my fears. I say again, Why is it that we are asked so hurriedly, so un preparedly and so thoughtlessly to agre to and vote for these proposals? What for? In the vague hope that at the proposed International Trade Conference we shall get some hypothetical but balancing advantages.
I say with modesty, but with complete sincerity, that I would prefer to leave public life for good rather than see my country tied for 55 years at least to the whims of a foreign country no matter how friendly, how intimate, or how trustworthy our relationships might be. Britain has not fought and won, has not suffered and survived two world wars to become the poor relation of even the most kindly, the most benevolent but most autocratic of kinsmen. We must face facts however unpalatable. Our foreign policy, our domestic policy, our trade policy will be subject to the criticism of the United States for the next half century, and criticism may even be the least of our troubles. We have all had the same experience in our private affairs in regard to loan transactions, whether as lender or borrower. The transaction invariably strains, if it does not actually sever, friendship. Is it worth it? Do we want this unhappy situation to develop between two peoples like ours who have lived and worked and fought side by side for five years and gained mightily in respect and regard for each other? I beg the House to consider that danger.
I am trying to obey your advice, Mr. Speaker, but before I sit down I must make this one point with regard to the "waiver" provision. Page 3, clause 5, of the White Paper says:
 In any year in which the Government of the United. Kingdom requests the Government of the United States to waive the amount of the interest due in the instalment of that year the Government of the United States will grant the waiver if … the International Monetary Fund certifies that the income of the united Kingdom 
does not come up to a certain figure. Does the House realise, or am I wrong, that this in its simplest form constitutes a means test? How can the Government or the party opposite who have fought tooth and nail against the application of a means test, to the individual, now suffer our great country being subjected to this indignity? I hope and pray that the House and the country will refuse the bondage which this loan will involve and will retain, or regain, the spirit of that unforgettable year when we saved Britain by our exertions and the world by our example.

4.7 p.m.

Mr. Durbin: In view of the humble but official position that I.


hold, I propose to confine what I have to say to the suggestions for a Commercial Agreement that are contained in the Proposals for Consideration by the Inter-. national Conference on Trade and Employment; and to meeting, in so far as I am able, criticisms of this scheme that have been offered by the hon. Member for East Aberdeen (Mr. Boothby), the hon. and gallant Member for Devizes (Squadron-Leader Hollis), and the right hon. Member for Aldershot (Mr. Lyttel-ton).
May I ask what this Agreement amounts to when it is stripped of all the complexities and technicalities that my right hon. Friend the President of the Board of Trade explained with so much patience and lucidity yesterday evening? It is really a very simple proposal. It is to call a Conference and set up an Organisation for the purpose of bringing about an all-round reduction in tariffs and an all-round reduction in barriers to trade. It is made perfectly plain that any such final Agreement must be acceptable to all partners to the Treaty and provide them with concessions, in the freeing of trade, that they regard as adequate for their needs. The words are:
 Enter into arrangements for the substantial reduction of tariffs, and for the elimination of tariff preferences, action for the elimination of tariff preferences being taken in conjunction with adequate measures for the substantial reduction of barriers to world trade.
We are, I suppose, in all regards a great' people, but we are in some respects a rather paradoxical people. For 25 years Members of this House, members of successive Governments, of whatever party and whatever doctrine, have pleaded for this thing. We have always argued that being, proportionately speaking, the greatest trading nation in the world we should stand to gain much, and to lose nothing, from an all-round freeing of the channels of international trade. Again and again we have said that this advantageous course for us was made impossible because of the attitude of the United States of America. Now the United States are prepared to play. There has been a change in their philosophy, a change in their administration. They are offering us the opportunity to raise the whole level of the foreign trade of the world in which we, as the greatest trading nation, stand to gain more than

any other organised industrial community. And yet the moment this thing, for which we have so long asked, is conceded, on all sides of the House and from all sections of opinion a series of complaints and criticisms arise.
In what do these criticisms essentially consist? There are two arguments. The first is an argument that I had expected to be produced on this side of the House, though now it appears that we have made some converts to the proposal for planning an important part of our economic life, and we receive eloquent tributes to the advantage of long-term contracts and the planning of international trade which my right hon. Friends the Chancellor of the Exchequer and the President of the Board of Trade are accused of betraying. In this matter of economic planning I prefer honest enemies to fair weather friends. But there is the argument. The argument is clear— that we shall sacrifice the power to plan our international trade, to exert a control upon the volume and quality of our imports, and see ahead in the exchange of goods between this country and the rest of the world. The second argument, which, of course, is common to both sides of the House, is the fear that removing restrictions of any kind will, in the present distortion of our industrial system, put our balance of payments under undue pressure and remove the possibility of safeguarding our essential supplies.
I should like to suggest that both those arguments are equally ill-founded and can only be based upon a failure to study this somewhat intricate and unattractive looking document. As far as the first is concerned, the protections, the safeguards for State trading are as complete as they could be. My right hon. Friend the President of the Board of Trade explained at length that they are so conceived as to oater for every degree of State trading, for every kind of planning in the field of international trading, that any sovereign State chooses to engage in. There is a provision for those who wish to plan parts of the national economy, a provision for those who want to establish monopolies in a particular list of commodities, provision for those who wish to plan the whole of their international trade. Under the provisions of Section (e), Chapter III, the three


possibilities are foreseen. Our rights in that regard are completely safeguarded, with one important proper and just exception.
If this Conference assembles next year, if it is successful in negotiating an all-round reduction of tariffs, if it succeeds in getting the nations of the world to agree to a reasonable ceiling for tariffs of, shall we say, 25 or 30 per cent, then it is laid down that those who accept the obligation to keep their protective and restrictive tariffs to such a moderate level shall not be able to escape from that obligation merely by establishing a system of State trading and then offering differential prices to home and foreign producers, to imperial or external producers, in excess of the margins that are permitted by the negotiated tariff ceiling. For example, if it is a 30 per cent. which is negotiated as a tariff ceiling, it is reasonable, right, and honest to lay down that this ceiling shall not be escaped by establishing a State trading organisation that will immediately put 50 per cent. more on the price paid to domestic producers than to foreigners. That robs us of the particular instrument of restriction known as discriminatory price policy. The significance of that, I will turn to in a moment.

Captain Blackburn: Does my hon. Friend imply that the elimination of reciprocal bulk purchase agreements is not a serious limitation on the ability of a country to plan its foreign trade?

Mr. Durbin: I will come to that point when I discuss the alternative to this commercial scheme as a whole, which is, I think, the point with which my hon. and gallant Friend is chiefly concerned.
As far as the fear about our balance of payments is concerned, as far as the fear that lowering our tariffs, or removing any quantitative import restrictions, will make our balance of payments impossible, is concerned, that is safeguarded as fully and completely as words could do it. The essential paragraph reads
 Members confronted with an adverse balance of payments should be entitled to impose quantitative import restrictions as an aid to the restoration of equilibrium in the balance of payments.
That means to say that if, through the freeing of the trade of the world, the equilibrium of our foreign exchange position is endangered, if on balance it leads to our buying more than we are selling,

then we resume freedom to impose quantitative restrictions to the extent necessary to restore equality between our purchasers and ourselves. No safeguard could be more complete. It is only upon the single principle of discriminatory restriction in price that any limitation is accepted.
That brings me to my second point: what is the alternative to the scheme outlined, with these safeguards, in the document that I am attempting to discuss? The alternative is perfectly plain. It is implied in two of the Amendments that are not being called today. It was stated explicitly in the speech of the hon. Member for East Aberdeen. It is set forth at length in the letters to "The Times," from which he quoted with so much approval yesterday and, of course, it has been elaborated in immense detail in the literature that has grown up around this subject since first these ideas were discussed. The only alternative is to seek to lock up this country in a series of close biliteral trade pacts and to police those trade pacts with payments agreements. That is the alternative. It is that possibility that hon. Members who criticise this part of the total group of Agreements are concerned to protect. That is simply and plainly entering into a trade war with the United States. There is no alternative to it. It means that we take country by country, market by market, and try to canalise the trade between us and them into a single channel; that we go to the Latin-American countries and suggest that they should import from us because we import from them—a reasonable arrangement, and I will discuss whether it is a good one, relatively, or not in a moment. But it means excluding other countries from freedom to trade in that particular area and between that particular pair of countries.

Mr. Warby: Will. the hon. Gentleman allow me? Is he suggesting that competition is not a form of trade war?

Mr. Durbin: The essential difference is that you set up an elaborate legal system to bring the competition for exports directly under the aegis of the Government; you bring the Governments into head long conflict owing to the fact that, by a set of legal restrictions under the bilateral trading and payments agreements, you seek to exclude the exports of other countries from a particular market.

Captain Blackburn: I am grateful to my hon. Friend for raising this vital point, and may I suggest that many of us think, as Socialists, that it is the key-point in the Debate? May I suggest to him also that bilateral agreements of this kind need not necessarily be exclusive? You could have reciprocal bulk purchase" agreements which left a margin for trade with America and other countries.

Mr. Durbin: No, I am sorry to emphasise this point. If you enter into an exclusive bilateral agreement, and if there is any shortage in the total demand for the exports of the country, anything which canalises trade between two countries is bound to exclude third parties. Either these Agreements would leave the distribution of trade unchanged or they exclude third parties.
So that this is the alternative—a trade war with the United States of America. Now there are times in the history of a country when it is necessary to go to war —whether economic war or military war—and we have, therefore, to ask ourselves whether it is desirable that we should enter into a war of this kind at this time. But there is, first, a calculation which it would be wise to make, and that is, to ask: Who will win this war? The only card that we hold in our hands, if we embark on a war of this kind, is that we are large consumers; that, is, the weapon which every critic of this Agreement is afraid of losing. [An Hon. Member: "What a weapon."] It is a very powerful weapon in a condition of world depression where there is a shortage of purchasing power. Economic power then rests in the hands of those who are prepared to buy. But it strikes me as an extraordinarily feeble card to play in a trade war which is going to begin tomorrow, for we are not suffering in the world today from a shortage of purchasing power, we are suffering from a shortage of supplies. If, therefore, we embark upon a trade war upon this basis at the moment, we shall find we hold no cards and no effective weapon.
I would go further than that to make the last point for which I have time. I would like to set all these agreements in a slightly wider context. The supreme national and diplomatic task facing this country is to maintain the great alliance by which Hitler was beaten to the ground.

One of the most powerful members of that association of Powers was the United States of America. Three times in my lifetime the people of the United States have come to the aid of this country. It is perfectly possible to argue that they did it in their own interests, and for their own purposes, but they came to our aid; and I would say there are few bonds between societies stronger than those where sentiment and interest coincide. They came to our aid in 1917, they came to our aid in 1940. In the dark days of 1940 and the early days of 1941 they were the sole great Power in the world who were aiding us, the sole great Power in the world who put the disposal of their economic resources freely in our hands under the terms of Lend Lease, that was described by the right hon. Gentleman who leads the Opposition, who sometimes makes a statesmanlike utterance, as "the most unsordid act in history.'' I say it would be a tragic beginning to this diplomatic task, a tragic opening to this period of history info which we shall move, to enter into a trade war with the United States of America.
No one knows whether these two schemes will be a success or not. But the alternative is to embark upon a trade war with the United States or to enter into co-operation with them in the attempt to set up an orderly and expansionist system for the development of world trade and world finance. That is the simple choice before us. No one could be certain who would win the trade war, but what we can be certain of is that all would lose from it. So I would recommend these agreements to the House not only because of the dollars, not only because I believe that all of them are workable and in the interests of this country—dollars apart—but because I believe they offer the opportunity for entering into a free and productive cooperation in an attempt to increase the prosperity and security of the free peoples of the world.

4.28 p.m.

Mr. Oliver Stanley: I think every one must approach this Debate with a certain feeling of disillusionment. Strange as it may seem, we arc sitting here today as the representatives of a victorious people, discussing the economic consequences of victory. If a visitor were to come to London from


Mars and, still more improbable, were to obtain a ticket of admission to the Gallery, he might well be pardoned for thinking that he was listening to the representatives of a vanquished people discussing the economic penalties of defeat. Such is the price we have to pay for the struggle we waged in order that not only we, but others, should be free. I think the second feeling which all of us share is some feeling of resentment that a discussion of this importance should have been so hurried. I am not in that blaming the Government—it was, I think, forced upon them—just as they have had to force it upon us, but the consequences of this Motion are so momentous, the subjects which we arc discussing are so abstruse, the documents which we have had to study are so difficult, that it would have appeared an occasion where we should have been given time, not only for our personal study but an opportunity to discuss it with others outside, to ask advice, and to talk it over with ourselves. Instead of which, from the time that these documents were first put into our hands to the time that we had to start this momentous discussion was just over five days. If we had been asked to discuss the Bill for the artificial insemination of cattle without being given a clear week between its publication and Debate, the House would have felt that it had been badly treated. A discussion of this kind, with so little opportunity of preparation, makes these democratic functions almost a farce.
In the consideration of this difficult problem which is facing us, it does seem to me that it is essential that one should deal equally with both sides. It is not enough to deal just with the results, if we were to accept this Agreement, unless we are prepared to deal equally fully as to the results which would follow if we were to reject it. We are faced here, as so often in political life, with a choice between two evils. It is not enough just to dissect one of the evils and then expect people to accept the three sub silentio. I hope this afternoon to deal, if I can, not only with the results of acceptance, but also with the results which follow rejection of the Motion before us today.
The first thought which must occur to any of us on this Front bench is, what a difference there is between the reality of the Agreement which is presented to us in December and the bright hopes which

we used to indulge in when we and they were sitting together last May; when we hoped, as I think the right hon. Gentleman himself said, that this might have proceeded on different lines; that we might have got away from a purely commercial bargain and some consideration might have been given to that equality of sacrifice. In the period since May, the conducting of these negotiations has been out of our hands. It is the right hon. Gentlemen opposite who have been responsible not only for the negotiations themselves but for the background against which they have been conducted. I will only say about that, that, at the best, it is difficult to discern in these documents any sign of that greater generosity, that greater friendliness, that greater willingness to help which we were so assured in June would follow inevitably from the Election of hon. Members opposite; and, at worst, I think it is not unfair to say that the people of this country may have had to pay pretty heavily for the lucubrations of Professor Laski.

Mr. Sydney Silverman: Is the right hon. Gentleman saying that the course of negotiations in the United States of America, on the American side, was not directed only to the merits of negotiations then proceeding, but was designed to interfere in the political and internal affairs of this country?

Mr. Stanley: It was not designed to interfere in the internal affairs of this country, but the background against which the negotiations were conducted must inevitably have had some effect.

Mr. Stokes: On a point of Order, Mr. Speaker, and with great respect to the right hon. Gentleman, I want to put this point to you. There are a great number of people who want to express their views, highly contentious, on this matter and want to vote, and, in view of the fact that the Opposition have made up their minds that they do not know what to do, have they any right to occupy the time of the House?

Mr. Speaker: I am afraid that that is not a point of Order.

Mr. Stanley: I think I shall be able to persuade the hon. Gentleman in the course of my speech that I know exactly what I want to do, and that I have an


exact point of view. It is, of course, no good looking backwards upon this Agreement. We have to discuss it as we find it. I think it has been agreed on all sides that the Agreement which we are asked to ratify is a hard and a painful one. Even my right hon. Friend the Member for the Scottish Universities (Sir J. Anderson) said he was shocked, and as the House knows, my right hon. Friend is not usually moved to using strong language. We have been told, quite fairly, by the President of the Board of Trade that the three compartments into which this discussion falls—the Financial Agreement itself, the ratification of the Bretton Woods Agreement, and the Commercial Agreement—are all interdependent, that you cannot walk out of one while expecting to get the benefit of the other, and we have, therefore, to consider the effect of all three of these.
With regard to the financial terms, which have already been discussed, I will only say this. There is an argument. that the obligation which this would put on us of £30 million a year is an obligation which this country would be unable to pay, and that to enter into an agreement knowing that we should be unable to carry it out would be dishonest. Of course, if that was the fact, it would be dishonest, and dishonest in the extreme. That arises, I think, from a confusion of thought. I do not think there is any doubt that this country, hard as its burden might be, would be able to pay it in the way of being able to produce this extra £30 million of goods which would discharge our debt. What we mean when we say that we doubt whether Britain can pay is, that we are doubtful whether America is prepared to receive it. I have no doubt at all about our ability and willingness to pay. The ability and the willingness of America to receive must be her own business and cannot, therefore, involve us in any possible breach of faith.

Mr. Logan: May I ask the right hon. Gentleman

Mr. Stanley: I am sure that a lot of hon. Members want to speak and I do not want to occupy the time of the House unduly.

Mr. Logan: May I ask the right hon. Gentleman whether, if he has no doubt

of our ability to pay, he would agree that, if that money could be conceded to the country, it would relieve a lot of poverty and the country could get into thorough working order at an early date?

Mr. Stanley: That raises the whole question of what would be the effect on the country if we did not get this loan from America. I would like to return to the second of these three subjects—the Bret-ton Woods Agreement. That is a subject which my hon. Friend the Member for East Aberdeen (Mr. Boothby) has made his own. He has given to it, since the project was first mooted, a great deal of careful and, one might almost say, gainful thought.

Mr. Boothby: I am not allowed to talk, then.

Mr. Stanley: It must be the first occasion in my hon. Friend's life that he has ever been prevented from talking. I think one might fairly say of my hon. Friend that when, or if, he dies, he will be found to have "Bretton Woods" engraved upon his heart.

Mr. Boothby: Hear, hear.

Mr. Stanley: It is rather longer than "Calais," but, on the other hand, my hon. Friend presents a rather wider frontage than Queen Mary. I approach this question of Bretton Woods not perhaps quite with my hon. Friend's dislike, but certainly with the most profound disquiet. I am not going to argue whether this entails a return to the gold standard or not; as my hon. and gallant Friend the Member for Devizes (Squadron-Leader Hollis) said last night, which gold standard? But what, of course, everybody must admit is, that the Bretton Woods Agreement does entail a very considerable curtailment of our economic sovereignty. It means that we hand over to others at a certain stage the power to decide our economic future and to take economic remedies for our problems. I am not saying that that must not be done. Unless we are going to have complete economic anarchy, we must be prepared to make some surrender of that kind, and I do not object to it. We made a similar kind of surrender under the gold standard, and it is a measure of the vast progress of our civilisation that, instead of, as in the past, surrendering that economic sovereignty to a


mathematical formula, we are now surrendering it to an international Committee.
But what worries me is, that I have never felt that in the Bretton Woods Agreement sufficient variation was allowed, sufficient accommodation to suit the disequilibrium of the times in which we live. I think that Bretton Woods would have been an admirable agreement before 1914; it would have been a satisfactory agreement before 1939. I am afraid that what we have now may be building a tank to fight the last war—a simile with which the hon. Member for Ipswich (Mr. Stokes) will sympathise—and that this Agreement, with the small variations, is not consistent with the great economic disequilibrium and the large fluctuations which we may have to meet during the next few years.
The right hon. Gentleman the Chancellor of the Exchequer spent a considerable time putting before us, very clearly and quite fairly, the loopholes that exist for us in the Bretton Woods Agreement—four in number. But it is true that of those four there are only two which can be taken of cur own volition. The first is the 10 per cent. alteration which we can make on our own initiative, and the other is—the fourth that he mentioned—the right to escape, to contract out of the scheme as a whole. On those two, I would only make these remarks. The first is that when we went off the gold standard in 1931, we allowed sterling to find its own level. The fall that took place then was something in the nature of 22 per cent. and the 10 per cent. variation which we are allowed under Bretton Woods would have been quite insufficient to meet the remedy we then required. It was said the variation would barely have been sufficient. I would ask, is it still the case that the fourth remedy is open to us? Can we still, as a result of this, walk out of Bretton Woods? If we are told that it is implicit in the whole Financial Agreement that we walk into Bretton Woods, are we to understand that we can, after that, walk out, without any breach of the covenant?

The Chancellor of the Exchequer (Mr. Dalton): Certainly, that was never challenged in the whole course of the negotiations.

Mr. Stanley: That has certainly relieved one's mind. That is a very important

point and I am very glad indeed to have got that quite definite assurance.
I pass then, from Bretton Woods, with this one last word. It seemed to me in all the Debate yesterday that the best comment made on Bretton Woods was that when the Chancellor, having urged us to sign the Agreement with alacrity and cheerfulness, went on to fell us that, immediately after the Agreement was signed, he was going to get somebody to give an interpretation that meant something quite different from what had appeared to us.
I turn, finally, to the Commercial Agreement, which I find to be the most difficult of all to understand, and potentially, in future, it seems to me to be the most dangerous. It is a formidable document. The right hon. Gentleman the President of the Board of Trade told us yesterday, with pride, how well it was drafted and how clear it was. With all his great gifts it took him an hour and a quarter to explain it to us. I am afraid that at the end of it—and here I must apologise—I was not very much wiser, and I was certainly no wiser on what seems to me to be the fundamental point, and that is how far the Government are committed by this Agreement.
The right hon. Gentleman when he spoke certainly gave us the impression as he went on that these chains were very loose indeed; that the commitments if any were very small; and with regard to agriculture, that there was nothing in this Agreement to which the Government were now committed which would stop the implementation of the policy put forward by the Ministry of Agriculture. He told us that there was nothing to require us to get rid of preferences and nothing to require us to reduce tariffs, unless we were dissatisfied with the Agreement as a whole. We were gratified to hear that most definite assurance. From a mere consideration of the document, the American proposals and our answer, it is difficult to come to the conclusion that the commitments which the Government were already undertaking were so small.
Whatever the commitments of the Government, one thing is certain: There is no commitment, whatsoever, of any individual Member of this House. That is to say that when the Agreements come before us, all of us will be entitled to


accept or reject them according to whether we think that they provide a bargain which is good or bad. That is from the point of view of Members on this side of the House, a most important fact because we read into this document—we cannot help reading into it—a direct attack on something which to us is of supreme importance, and that is the doctrine of Imperial preference. It was put to the right hon. Gentleman yesterday that there was a difference in language which must be of significance between the terms of tariff and the terms of Imperial preference. It referred to a reduction of tariffs and to an elimination of Imperial preference. The right hon. Gentleman answered, I think a little ingenuously, that that was merely following the wording of Article VII.

The President of the Board of Trade (Sir Stafford Cripps): I did not say "merely."

Mr. Stanley: Not merely following, but following the words of Article VII. The wording of Article VII was that we should reduce tariffs and abolish and eliminate discriminatory practices. The then Prime Minister always preserved in the clearest terms our position that we did not admit that Imperial preference was discriminatory practice. That position, it appears, has now been surrendered by the Government. Imperial preference is now classed with these other forms of discrimination which are regarded as economically anti-Socialist and which have got to be eliminated. Porto Rico by sending three representatives to the American House of Representatives, without the privilege of voting, are allowed to enjoy, as a matter of impeccable fiscal purity, privileges which Jamaica can now only get as a result of illicit economic discrimination. We believe that this attack, if it is to be carried out, on Imperial preference will meet with the greatest hostility from Members on this side of the House.
The right hon. Gentleman, in talking about this commercial agreement, talked quite rightly about economic anarchy, and said that the object of this agreement was to prevent economic anarchy. In the years between 1931 and 1939 there was only one bit of the trade of the world which rose above the sea of economic anarchy that raged around us and that was our inter-Empire trade. It was that

trade which had been bound together by Imperial preference. It seems to be madness that you should set out to destroy your only area of sanity, and only then to see if there is something else you can put in its place.
There is one plea which I make to the right hon. Gentleman opposite, and that is with regard to Imperial preference as it affects the Colonies. The right hon. Gentleman the President of the Board of Trade said that the person who gave the preference was not the person who received the benefit and, therefore, of course both parties would have to be consulted. When you come to the Colonies the spokesman for the Government in international negotiations speaks for both, and it is, therefore, of special importance that whoever, in any negotiation of that kind, represents Colonial interests should be thinking of the negotiation in terms, not of our interests but of theirs. Whatever Imperial preference may be to us from the Dominions, however much it may mean an expansion of our trade and an improvement of our economic position, there are certain of our Colonies to whom Imperial preference is a question of life and death. Bananas in Jamaica, sugar in Mauritius, tobacco in Rhodesia—remove Imperial preference and you sentence these Colonies to economic death. It makes nonsense of the Colonial Development and Welfare Act if you are going to give that assistance and yet take away from them their whole means of livelihood.
I have tried to dwell on some of the aspects of one side of the case. It is a sombre picture; it is a frightening picture —a picture of the obligations we undertake, and the difficulties that may arise if we adopt these arrangements. No examination could be complete unless, at the same time, we tried to view the picture on the other side—the results which would occur if these arrangements were to be rejected and if this credit were not to be forthcoming. What would be the consequences of rejection? I think that it is the duty of the Government to tell us, in plain and unequivocal language, just what the rejection of this loan would mean to the man and woman in the street. We have a right to know that before we decide this problem.

Mr. Dalton: Hon. Members have been told already.

Mr. Stanley: I hope that will not be the right hon. Gentleman's argument. I hope that he will be able to add to what he has said. The President of the Board of Trade can add nothing to what he said, because he merely passed the buck back to the Chancellor of the Exchequer. One hears some people talking as if the results of not getting this credit would merely mean a continuance or some slight extension of the austerity which we have been experiencing for six years—just doing without some of the few luxuries which are left to us; going without tobacco, seeing fewer films, a little less perhaps of the few varieties we now have in our daily food. We hear the story of a slight increase of austerity, which the hon. Member for East Aberdeen would accept as a crusade, and the right hon. Gentleman the President of the Board of Trade would accept as a matter of custom. If that were all that it meant, then this country might accept it and might be prepared to shoulder that burden, rather than assume these great obligations for the future.
I, personally, do not believe that is all. I believe that it is much more than that. I believe that it would entail upon the men and women of this country sacrifices of quite another order. I believe that if we were not to get these credits, by the time our reserves ran out—and that would be very soon—the standard of life of the people, and the standard of food and necessities would be hardly sufficient to maintain physical health, to maintain the social discipline, and to maintain industrial efficiency. When you have made these terrible sacrifices and reduced the people to these standards, I doubt whether there would be enough left over to provide capital equipment and raw materials to get a really effective recovery of our export trade, and by that means find the only way out of the vicious economic circle into which we have got. It is the duty of the Government to tell us whether I am right in my diagnosis. I have no more means of access to information than anybody else; I have nothing but the public figures to discuss. I can, of course, carry no authority, but the Government can say whether the description which I have given is right or wrong. To me it is, after all, the crucial point. If I am

right, and if these would be the consequences of not getting this credit, what then is the alternative?
Several hon. Members have suggested that if we were to refuse this Agreement, the result would be that before very long, the American Administration and the American Congress would come back with something more favourable. I find that very difficult to believe. I cannot claim the knowledge that others have of American public opinion. I was astonished when listening to the Debate yesterday to learn how many Members of this House have toured America, making lectures and giving speeches. It only shows what a tough nation the Americans are. I have no such experience. I cannot pretend to be an expert on American public opinion. I can only fill the picture by asking myself what, in similar circumstances, would we do? What in similar circumstances do I think this House of Commons would do? I say, quite frankly, that I do not believe that if the Government of this country made an offer to another country, and it was turned down, this House of Commons, if the Government of that country came back within a few weeks, would be prepared to offer more favourable terms. That can only be a matter of opinion, but I feel that this present alternative of rejection being followed by a better offer, is a mirage.

Mr. Boothby: Does the right hon. Gentleman seriously believe that the United States would have refused to contemplate a straight commercial loan, on condition of a higher rate of interest, and would that not have been better? If they had refused, would that not prove that they are using their power, and is there any reason to believe that they would have done that?

Mr. Stanley: That of course I cannot answer. Only those responsible for the negotiations can. We have to face the Agreement that has been made, not some other which might have been made. We have to face the consequences of turning it down.

Mr. Nicholson: Is not the logic of my right hon. Friend's argument that there are no corresponding advantages to the United States? Surely the basis of the argument in favour of the loan is that it has material advantages, and may one


not assume that the United States Government are as anxious for these advantages as we are anxious for the advantages we shall derive?

Mr. Stanley: I think that is so. That is the reason they have made us an offer, but I cannot be persuaded that if we rejected this in a few weeks or months the United States Administration and Congress would be prepared, as a result of that, to make us a better offer. For that reason, if the right hon. Gentleman opposite or whoever winds up the Debate agrees that my view of the result of the rejection of this loan is correct, I certainly cannot vote against this Agreement.

Mr. Dalton: Why not vote for it?

Mr. Stanley: I am going on to say why. I believe that if we rejected it would land us in a catastrophe from which there could be no recovery, whereas if we accept it we accept difficulties which we may in time to able to surmount. The right hon. Gentleman asked me why I cannot vote for it. It is because of the action of himself and his Government. If he had come to this House and had presented this Agreement and said, "This is an Agreement the financial terms of which are hard, where the Bretton Woods Agreement is dangerous, where the commercial treaty may be disastrous, though we will do our best to modify it, but because of the consequences of refusal we have to accept," and if he had wanted my vote in order to overcome the rebels behind him, I would have given it and gone into the Lobby with him. That is not what he has done. It is not merely a question of words on the Order Paper; it is the attitude and the speeches of the right hon. Gentlemen opposite. It is their words and their speeches, and if they like they can deny it; they welcome what I only acquiesce in.

Mr. Dalton: Welcome what?

Mr. Stanley: They welcome the approach to a commercial agreement on the lines to which they have agreed. I welcome the approach to a commercial agreement, but not on the lines of this document which the right hon. Gentleman has presented. It is not only for that reason why I cannot possibly vote for this Motion. The one thing which we on this side retain from this Agreement is the

absolute, unimpaired right to take whatever line we like when these trade agreements, if any emerge from this Conference, come before the House. If we were to vote for a Motion in these terms we should assume at least that amount of responsibility that the Government opposite have assumed. To that extent we should have impaired the right, which I claim, to enter these discussions completely unfettered, and to judge the treaties purely on their individual merits.
I know that hon. Gentlemen opposite taunt us with sitting on the fence. There are a great many hon. Members opposite who would like to be on the fence with us. Is it really pretended that hon. Members on the benches opposite like this Agreement, that these little groups we have seen huddled together in corners in the Lobbies have all got there for the purpose of saying what a wonderful Agreement it is? They have gote to vote, whatever they think about it, whatever their views. For them it is the Government Lobby or the Party Belsen. Indeed there is only one group of people who will go, according to their spokesman, happy into the Lobby tonight; that is what we used to call the Sinclair Liberals—[An Hon. Member: "Where are they? "]—but which I suppose now we must call the Davies Liberals, the followers of "Clem the Less." Their spokesman announced that they would go in the Lobby happily in support of this Agreement. Of course they will. It is a return to free trade. It is just like the sound of a martial band to an old war horse. It brings back to them happy memories of the days when they had a policy and a party. Tonight they will go into the Lobby and strike a blow for Mr. Gladstone. What does it matter that the blow may fall on the heart of the British Empire?
It is a grim decision the House has to take. I believe that this Agreement has to be accepted. But all the evil consequences I see flowing from a refusal of this loan now will flow equally from its exhaustion in two years time, unless we have used those two years to the best possible advantage? That puts a great responsibility not only upon the Government but upon this House and upon the people as a whole. We have got, in these two years, to make the best of the chance that is given us. If the Government fail,


if they are unable in that time to revive our export trade, to enable us once again to stand on our feet, then in two years time the outlook will indeed be black and we shall today have gone, in vain, under the Caudine Forks.

5.9 p.m.

Miss Jennie Lee: When the right hon. Member for West Bristol (Mr. Stanley) talked about the choice open to Members on this side of the House being that of the Government Lobby or the Party Belsen, he brought back to me not altogether unhappy memories. I have known what it was to be in the Government Lobby in an earlier Labour Government, and I have also known what it was to be in the Party Belsen. I can assure him that one difference between the present Labour Government and that of 1929–31 is that this Labour Government is infinitely stronger, considerably wiser, and with strength there comes that very great quality, tolerance. However unhappy it may make hon. Gentlemen opposite, honesty compels me to confess that those of us on this side who may be in a mood this evening for a little flutter of rebellion—[An Hon. Member: "Hear, hear."] —do not talk too soon—there is no Party Belsen waiting for us. Maybe that is a much more restraining force than any threat. I do not think that any of us on this side of the House at least are in a mood for mock heroics. We are not seeking to demonstrate to this country or to America, by going into one Lobby or the other, how brave or how independent we are. But it still remains that at this point of the Debate some of us are still deeply troubled about the propositions which the Government are asking us to endorse.
I would say that so far only one thing has been made explicity clear. That one thing is what the Tory Party in this House of Commons intends to do. Being Scots, I was able to follow the right hon. Gentleman the Member for the Scottish Universities (Sir J. Anderson), when, in yesterday's Debate, in decent restrained Scottish terms, he hinted to the House and to the world that if there had been a Tory Government instead of a Labour Government in this country the American terms would have been more generous. Then when the right hon. Gentleman the Member for Aldershot (Mr. Lyttelton), later in the Debate, returned to this issue he said

quite boldly that that would have been the fact. In today's Debate for the third time the right hon. Member for West Bristol underlined that. Now we know exactly where we stand, but I would advise hon. Members opposite to play that card rather carefully. I would enjoy meeting any of them in any subsequent by-election—not that we are asking for the death even of any Member of His Majesty's Opposition—if they went before a representative British audience, and said to them, "The American Government does not approve of your political choice, and the American Government is using its financial power in the world to coerce you." Our people, who, above all, I hope, value their integrity and independence would not tolerate such intervention. If Members want to be quite sure of giving deep offence to the British people, that is all they require to say when they place their case before them.

Mr. Edgar Granville: Has one single shred of evidence been produced during the Debate to support the view that has been heard on this side above the Gangway that the American Government would have given better terms to a Tory Government in this country than the present Government? Is it not also a fact—

Mr. Deputy - Speaker (Mr. Hubert Beaumont): The hon. Member must not make a speech.

Miss Lee: I agree that no evidence has been produced but it is sometimes useful, if a case is weak, if vague deductions can be produced instead of established facts. What the hon. Gentlemen opposite have in mind is that the present American Administration is more nearly their opposite number than ours. I grant them that; it is. And what they perhaps deduce from that is that "dog don't eat dog," but I have still to see two hungry dogs meeting and one handing the bone to the other. That is the assumption behind their argument. The present American Administration could be very well described as a Government of hard-faced business men who look as if they have done well out of the war—perhaps hon. Members opposite recognise the quotation. I regard the present American Administration as that of hard-faced business men and, believe me, they would apply the laws of the jungle if they were negotiating with a


Tory Government or any other kind of government.
When my hon. Friend the Member for Edmonton (Mr. Durbin) said "We do not want a trade war," I want to suggest to him, that whether we want a trade war with America or not, we have got it, and that no matter what our voting position is tonight, we still have got that trade war. Why? Perhaps we should see it in truer perspective if just for one moment in these Debates, instead of concentrating our attention entirely on Washington and on American administration, hon. Members would consider the point of view of the honest-to-God ordinary American citizen, earning his daily bread, anxious for security, anxious for employment, anxious to improve his conditions, not wishing any harm to the rest of the world, indeed wishing well to the rest of the world and wishing for us too, full employment, a rising standard, but, very naturally, concerned with his own position first.
I would invite the right hon. Member for West Bristol to come with me, let us say, to a drug store in a side street of Detroit and just for once try to see how this entire argument and the relationships between our two countries look when one sees them through the eyes of a group of men who are earning their living in an automobile factory in Detroit. What is the position of those men and how do they see themselves affected by this Agreement? Such a man has been earning good money during the war and, since the war ended, he is either on strike, going to be on strike, or has just been on strike. He strikes because he is trying to prevent his standard of life declining. He is very anxious, and very afraid at the moment. He sees no possible future security. He is afraid of demobilised Americans queueing up for his job. There is rising anti-Semitism in America at the moment and rising anti-negro feeling.
If I may make a divergence—because it seems that most of us like to come here clad in quotations from the" Economist ' and the correspondence columns of "The Times"—I was quoting from the columns of "Tribune." If I am permitted to quote myself I would point out, and this is very serious, that:
 Ninety per cent. of the coloured troops who were overseas during the war do not

want to go back to the poverty and virtual slavery of the South.
The right hon. Member for West Bristol and I might meet one of them in Detroit, and the white men we are with might invite the coloured man to join us and then might not, because they are afraid of their economic competition at the moment.
I am mortally afraid that the line of argument put forward by hon. Members opposite, and not least by the hon. Member for East Aberdeen (Mr. Boothby) will make the ordinary. working man of America feel that we in Britain and he in America are in competition with one another, that what he gets, we do not get, and what we get in the form of this loan, is something which is going to be taken from him.
The right hon. Gentleman the Member for West Bristol, said that sometimes in discussion it might seem that we were a vanquished instead of a victorious nation. But we are half vanquished. We are half vanquished in the sense that the present Government of Britain is an anti-Fascist Government whose supporters were fighting Hitler long before 3rd September, 1939, and in that sense we have won the war in a double sense—we have defeated Hitler and defeated the most reactionary ideas in the world. But, when I turn to America, I have to report to this House that the American Government began this war not on 3rd September, 1939, but much later, and that my friends in America, the authentic progressive people of America and the good anti-Fascists of America helped and assisted us—I was in Detroit two months before America came into the war and I know where our friends were and where our enemies were—but the American Government is a Government which can be truly paralleled with the Government we in this country had after 1914–18. That is only half a victory. That is why I am mortally afraid of the terms of the loan, both as it affects us in this country, and as it affects the working man of America.
As I see it, the American Administration is trying to buy economic salvation on the cheap. One thousand million pounds seems a lot of money if one is thinking in terms of a personal fortune, but what the American people must understand, and what we must understand, is that if that amount had been at least twice as


much, if it had been a credit without interest charges, then it would have been much more in the interests of the American people, and of ourselves, and a much sounder proposition in helping to reach the goal we are all at least verbally agreed on, the goal of full employment both in America and here. There is no wisdom in this loan, and there is no kindness in it. There is nothing in the terms of this loan which give us any reason to suppose that an administration which could offer a niggardly, barbaric antediluvian, settlement, such as this, can solve the unemployment problem in their own country much less help the world.
We on this side of the House hope that the American people will win the fight that is going on inside America at the present moment to maintain and improve their standard of living. I consider that when my right hon. and learned Friend the President of the Board of Trade spoke yesterday, he invited me to go into the Lobby against the Government. I have his words here. My right hon. and learned Friend on that occasion said, quoting from Section B of the trade proposals:
 High and stable levels of employment arc a necessary condition.
for co-operation. Now my right hon. and learned Friend has a reputation, which he deserves, of being a highly moral man. I do not think he tells lies, either in private or in public, and I ask my right hon. and learned Friend if on the evidence we have of the rich growing richer in America and the poor growing poorer and the sharp conflict between the unions and the Government, he believes in American full employment. The American workers once believed they had a friend at the White House—they do not believe it now. Let us appreciate that there is not just one America. I think one of the basic fallacies of these Debates is the way in which we talk about Britain and America; there are two Britains, and at least two Americas..

Mr. Boothby: More than two.

Miss Lee: More than two. But it would be a tragedy if the America which the President of the Board of Trade has been talking about, believed there was only the Britain which has been waving Lord Beaverbrook's flag, and stressing above all Empire preference. It would be a tragedy if the American people believed

that it was the old Tory Imperialists who criticised the terms of the loan, and that the progressive people everywhere were welcoming it.
I am speaking in this House as a Socialist and an Internationalist, without apology, for American workers as well as British workers, because that is the meaning of internationalism, and I say that the American workers are in much greater danger at this moment of great poverty, of great unemployment, of internal anarchy and trouble than we are in this country.

Mr. Boothby: May I ask the hon. Lady a question? She claims to be progressive. I would only ask whether she thinks it progressive to go back to the economic position of the 19th century, which is what this Agreement is advocating?

Miss Lee: The hon. Member for East Aberdeen, our Conservative Marxist on the Opposition Benches, does not always correctly anticipate the end of an argument. I apologise to the House if I am speaking at length—[HON. MEMBERS: "Carry on "]—but I do feel that the point of view of the ordinary working people here and in America, and how this matter will affect them, has not been sufficiently expressed in this Debate. I consider that the American people are the victims of a hard-faced businessman's Government which is leading them into trouble, as our Government after the last war led us. The people of this country have a certain measure of protection; they have a Labour Government which will hold hon. Members opposite at least partly in check. If this loan was for twice as much, if there was no interest charge involved, please may our friends in America understand this, it would be in their interest—even more than in ours. What do they get out of it? Since we have been reduced to regarding this as a business deal, what is in the loan for the American people? There is in it, for the workman, a job and a wage, there is in it for the American employer, a contract and a fat profit, there is even in it for the American Government, a turnover, a cash benefit on the terms of the loan, although I do not stress that because it is the least important of the three elements. The most important element is that by the terms of the loan we know quite definitely what the American people are getting out of it.
What are we getting out of it? In round terms £1,000,000,000. Suppose that of that amount we spend £500,000,000 on consumer goods. I am not going to stress my hon. Friends on the Front Bench to be exact as to how much of the loan will be spent on consumer goods and how much will be spent on industrial equipment. That would not be a fair question. [An Hon. Member: "Unless you know the answer."] It is sometimes wise not to ask questions unless you know the answers. That is a very misleading question, because there is no form of calculation by which it can be accurately answered, as everyone knows who has thought about this subject at all seriously. Perhaps seriously is the wrong term; I should rather say "thought about this subject from a Socialist standpoint." Supposing we spent £500 million on consumer goods, it would not be a case of the packet of cigarettes referred to by the hon. Gentleman opposite, but, as I work it out, it would be roughly £10 per head which the people of this country can get out of the credit in the form of films, tobacco, cotton, consumer goods and a little better food. That means a lot. I am very diffident indeed in suggesting anything that would mean that our people who have suffered so much already should suffer even more. So far, I have made up my mind that I cannot possibly vote in the Government Lobby, though whether I shall vote in the Opposition Lobby or abstain, depends on the answers that I have still to receive on the most basic issues involved in this Debate.
I would like to refer to a letter in" The Times? written by my fellow-countryman, Colonel Walter Elliot, who said that there are two interpretations to this Agreement. But there are not two interpretations. There are 20 interpretations, as we have heard in this House. I think, on points, the hon. Member for East Aberdeen lost his gold standard argument in yesterday's Debate, but he has still got a certain amount on his side. When the right hon. Gentleman opposite sat down he was still telling the Members of the Government that he was not clear just how far Imperial preference was sacrificed and just what that would mean. Some of us on this side of the House are still not clear as to how much we have to pay in the long run in order not to do without £10 worth of films, tobacco, and the

rest. The Americans are pressing a sharp bargain. They are saying "A year from now we want multilateral trade; we want to discourage bulk trading on discriminatory terms, and we want to discourage bilateral trading. "Unless I misread the situation. Big Business in America is pursuing this line because it believes that in competition with this country it can do very well in cut-throat export drives if it has this Agreement ratified. Mind you, I do not think they will do as well as all that, because at the moment we are in a sellers' market and I think there are markets for all of us, but I am deeply troubled all the same.
Take our mining industry. We are told that it will require from £250 million to £300 million of capital to re-equip it. The figure of £1,000 million from America begins to look very small, does it not, when we equate it against our basic needs of industrial reconstruction and of consumer goods? Also a year is not a long time to put a great industry, which hon. Members opposite have misused for generations, into tiptop working form. In the time, is even the mining industry of this country going to be re-equipped and made into a sound going concern to enable us to face American trade competition on anything like equal terms? I do not like discrimination, but what I fear is that the American Government are going to be allowed to inaugurate not Henry Wallace's "Century of the Common Man" but Mr. Henry Luce's "American Century."
I am the last person who wants to wish God speed on that journey, because I see it as a disaster to the American working people as well as to ourselves. So when hon. Gentlemen on the opposite benches say we do not want discriminatory arrangements, I would point out that there are nothing but discriminatory arrangements being offered to us at the moment. America is not offering the same terms to all the world. America is not obliged to offer to other countries even the Loan terms which she offered this country, and my fear is that while America can use its dollar power for discriminatory purposes in the interests of capitalist America, Great Britain cannot use the discriminatory powers of its home market in the interests of a more progressive and Socialist Great Britain. My fears may be unfounded, but they are perfectly


genuine. I will conclude now although, like every other hon. Member in this House, I am well aware that I am only skimming the surface of the subject.

Major Sir Jocelyn Lucas: Could I ask the hon. Lady one question? She has referred to spending £500 million for consumer goods and £300 million for capital goods. That amount is not available. We have to subscribe £325 million for the monetary fund, £65 million for the bank with a contingent liability of £265 million, and we have to repay£162 million. That leaves about £200 million.

Miss Lee: I thank the hon. and gallant Gentleman for underlining the main lines of my argument. I have been complaining about the smallness of the amount and its inadequacy to meet the requirements, although I do not agree with his figures. But I must not take up the time of the House going into the matter. Hon. Members are perfectly entitled to ask me what is the alternative. If the alternative to accepting this Agreement means that in three, four or five years from now we will be in a stronger position, if I could be quite sure that by reciprocal or bilateral agreements—I do not know why "bilateral" has suddenly become a nasty word—and by bulk purchase on a basis of mutual help between ourselves and Australia, ourselves and Czechoslovakia, ourselves and any other country, we could give one another security—and it might be worth while for each of us sometimes to pay a little more for goods—we might not be so desperately anxious to go into 19th century cut-throat competition. I see nothing in the propositions which the American Government are offering to the world except a return to laisser faire 19th century competition in circumstances that favour America but which no longer favour this country. When the hon. Member for Edmonton said that the American Government were prepared to play, I think "play" is the operative word. On the highest levels of patriotism I would like to vote against this Bill, and I may do it—I am not yet sure—but if I refrain from voting against this Measure the reason will be on the benches opposite. If I do refrain—I do not know whether I should do hon. Members opposite so much honour—but if I do refrain, it is because of the knowledge that if the people of this country in the next year or two

have to undergo a period of deepening austerity for their ultimate good, I have no reason at all to suppose that, during that difficult transition period, hon. Members opposite will put their country's good before party advantage.

Mr. Osborne: On a point of Order. May I say that is a lie?

Hon. Members: Withdraw.

Mr. Deputy-Speaker (Mr. Hubert Beaumont): That is an unparliamentary expression, and I must ask the hon. Member to withdraw it.

Mr. Osborne: I am very sorry, Mr. Deputy-Speaker. I withdraw that. May I say this—

Mr. Deputy-Speaker: The hon. Member has withdrawn the expression. It would be as well if the hon. Lady continued with her speech.

Miss Lee: If I may, through you, Mr. Deputy-Speaker, say it, "lie" is not a word that we often use in this House, but I have sympathy with the hon. Gentleman because this is a case of "This is my faith, now tell me yours." The hon. Member obviously has a different interpretation, but there are different interpretations in this House, and grave trouble is going to be caused, because when the nations begin to interpret those measures there will be different interpretations in America and in Great Britain. I have a basic lack of confidence in the present American administration, and I believe that along with American anti-semitism and anti-trade unionism and all the rest there will be an anti-British feeling. A Government which has no rational economic solution to its difficulties has to do what Hitler did; it has to look for scapegoats. I want our real friends in America—the real progressives of America—to get after their reactionary Government and to point out to them that they are at least a generation, if not 100 years, behind the times, that this settlement is neither in their interest nor ours, and those of us in this House of Commons who are most deeply distressed about it are distressed not for old-fashioned Tory Imperialist reasons but because we want to see real international friendship and real pacts of mutual advantage to Great Britain and America. It is folly to assume that any of those things lie in this present Agreement.

3.42 p.m.

Mr. David Eccles: We do not know how the hon. Lady is going to vote. As I have listened to the speeches by hon. Members opposite, I conclude that those hon. Members who are going to vote against the Government are going to do so because they think the set of proposals which we are considering will kill Socialism. If that is the result of the proposals I object to it very much, because I consider that the job of killing Socialism should be reserved for my hon. Friends and myself. This is by far the most serious issue which has been before the House of Commons since I came into it, and I think it is right that I should say what is in my mind on this subject.
The Government's Motion asks us to welcome a set of proposals which, apart from a settlement of the Lend-Lease Agreement, are obscure, harsh, and, I regret to say unworthy of two allies who have just saved the world by their exertions. None the less, I see that we must have a dollar credit because the sacrifices that we have made in the war have reduced us to such serious financial straits that we cannot get on without it. But the terms on which the credit is offered are extremely hard. When I read the Loan Agreement I came to the conclusion that the Americans believed that the war began with a bang at Pearl Harbour and ended with a bang in Tokyo Bay. Yet today, their lawyers are busy at Nuremberg proving that Hitler's war began long before 1939, and any American observer in this country would have to report home that, as far as the British people are concerned, the war is nothing like over.
It is true that the shooting has almost stopped and that we have taken the blackout down from our windows, but the blackout remains on many other aspects of our lives, and we had hoped that the Americans would help us to remove those other blackouts as generously as they helped us in the war. In that hope we are disappointed. Such are the terms of the credit that the children and grandchildren of those of our generation who served and died in this war will have to go on paying America for the effort they put into the common cause for freedom. It is just because the Americans set such a superb standard of generosity during the war that we feel so keenly the swift return to the level and practice of commerce
This credit is inevitable, and the reasons to my mind are these. In the White Paper the calculation is made that for the next three years the gap between our exports and imports will be £1,250 millions. If we do not get a credit from America, where are the goods coming from to fill that gap? It is no use saying that the goods can come from the sterling area; on all the best evidence, they are simply not there. And if they were available in the sterling area, who can say that, if we had not got satisfactory relations with Washington, the countries of the sterling area would be willing to add another £1,250 million to the balances they now hold in London? This £1,250 million commercial gap is not the end of the story. To it must be added the military expenditure which we shall have to incur so long as we have troops in overseas theatres. If we were to withdraw those troops now it would be a bad day for Anglo-American co-operation, and a bad day for the Anglo-American conception of democracy. They have to be maintained at great expenditure of foreign currencies which we cannot obtain, for the time being, by exports. Any hon. Member who votes against this credit must ask himself whether he is willing that the Armed Forces of the Crown overseas should be reduced to a level where the carrying on of a Great Power foreign policy might be very difficult. He must further ask himself whether he is prepared to go to his constituency and justify a terrifying drop in the standard of life. I am quite sure, contrary to what the hon. and gallant Member for Ayr Burghs (Sir T. Moore) has said, that the housewives of this country would be very seriously strained if still more burdens were put upon them. I am not going to join the party of strength through misery, and therefore I say that this credit is inevitable.
Is there any alternative to the credit? I regret that my hon. Friend the Member for East Aberdeen (Mr. Boothby) is not in his place, because he suggested a commercial loan, and he ought to have known better. Does he not realise that what he was asking for was a credit with no strings to it? Does he not known that we have to have a string to this credit, because we must have a clean settlement of Lend Lease? Would the New York bankers have been able to give us that?


Does he not know that we have to borrow such a large amount that we must start with a moratorium for five years? Does he not know that a commercial credit in America is tied up with the obligation to spend the whole proceeds in America? Does he not know that the French credit, which he rashly brought before the House, is not a commercial credit, but is given by a State Bank, the American Export and Import Bank, and has upon it a string which we could never have put up with—namely, that the whole proceeds are to be spent in America, whereas the very purpose of this credit is to put us in a position where we shall have sufficient reserves to give confidence to the other countries of the sterling area that they can continue to keep large balances in London? A commercial credit is not an alternative at all, and should never have been brought forward.
I come to Bretton Woods. I am a supporter of Bretton Woods as the best machinery yet thought of for fair financial weather. We have to have some sort of machinery to arrange the convertibility of the world's currencies, but of course no machinery is any good at all if the great Powers do not keep their balances of payments within manageable proportions. Several hon. Members have said that by subscribing to Bretton Woods we are going back to gold. I am really astonished that they should know so little about the management of money in the last 15 years, as to make that statement. Is there any hon. Member in this House who would say that the quantity of gold in the Federal Reserve system has been the controlling factor in the quantity of credit in the United States during the last 15 years? Of course it has not. In subscribing to Bretton Woods what we are doing is something much more sinister, we are linking the pound to the monetary and commercial policy of America, not to gold. Therefore, the key to the whole of this business is, what confidence can we have in the monetary and commercial policy of the United States?
That brings me of course to Cmd. 6709, which is the only blue print of this policy which we have. I want to say at once that I think the obscurity of these proposals is matched only by the indecency of asking us to pass judgment upon them in such a hurry. They raise a funda-

mental issue: on what principles ought the British people to conduct their foreign trade from now onwards? We talk about foreign policy as being something on which we are all united. We say that we are all agreed upon certain desirable objectives, that we shall maintain the strength and unity of the Empire, make as good friends as we can of America and Russia, safeguard the interests of small nations and, in particular, get on intimate terms with the countries of Western Europe. But all those things remain on paper unless we have a good economic system to sustain them, and economic and commercial policy after the war is part and parcel of foreign policy. What the Government are doing—and I think they are doing a wrong to this House and to the country—is making us decide, or inviting us to pass judgment, on one-half of the foreign policy of this country at five days' notice.
I think that this is so serious an issue that I make no apology for laying before the House the three alternative principles on which we might run the foreign trade of this country. In the first place, there is national socialism, ably argued by the hon. Member for South Nottingham (Mr. N. Smith) yesterday. I do not deny that we should make a better job of national socialist economy than Dr. Schacht did in Germany, but it would not suit this country. The right hon. Gentleman opposite will agree that it is too limited a doctrine for a country with such enormous trading responsibilities as ours. That leaves two alternatives: either multilateral trade on a world basis, or multilateral trade within the sterling area on a regional basis. We have to make up our minds between those two, otherwise our foreign policy is nonsense from now onwards. I am for multilateral trade on a world basis, and I propose to show the House why multilateral trade on the sterling area basis is out of date. It might have worked had we put it into practice in 1919, but since then science and history have moved a huge stage forward, the world has contracted, and it will not work now.
I consider that multilateral trade on a world basis offers the only hope of preserving economic peace between the three great Powers, Russia, America and the British Empire, and that if economic warfare were ever to break out, very shortly


afterwards we should have an atomic war, and from that moment onwards the future of civilisation is not of much interest. There is only one serious argument against multilateral trade on a world basis, and it is an argument I cannot possibly accept. It is that British industry will never again be able to compete with American industry. If that is true—which I forcibly deny—if it is true that we can never sell our goods in level competition with the Americans, we had better put up the shutters of the British Empire now, because any attempt to defend ourselves inside a ring will be no good in the modern world.
These rings or blocs date from the same period of static defence as the Maginot Line and the Atlantic Wall. In the modern world, the blitz of exports will smash those barriers or jump over the top of them. I will tell the House why. It is because the common people of the world will not for long stand being inside a ring fence, with a lower level of life than is enjoyed in the area outside. That goes for Russia. I am quite sure that many of the unattractive things which the Russian Government are doing now are done because of their fear that the ordinary men and women in Russia will find out that their level of life is much lower than ours and still lower than the American's.
I come back to Cmd. 6709. This is where I think the President of the Board of Trade made a great mistake yesterday. He did not realise that any ordinary person, reading Cmd. 6709, receives the impression that it is an American document, and that therefore it repels us straight away. These proposals are not the pattern of a truly international trade system, they are the pattern of an American world trade system, which is something very different. I want to tell the House why it is different, and I propose to do so by referring to the things that axe left out, and not to the things that are put in that document, so that I shall not enter into competition with the Front Bench in interpreting various phrases in the document. The really bad thing about Cmd. 6709 is that it is all one way. Everything in it is telling us that we must not do certain things which in time of necessity and trouble we may have to do.
There is nothing comparable in that document to tell the Americans what they

ought not to do. Why is there nothing in it about their very peculiar methods of trying to corner the South American markets? There is nothing about that kind of discrimination. Why is there nothing about their insistence that the proceeds of the dollar loans should all be spent in the United States? That is discrimination on the grand scale; they have just applied it to the French loan. What is more, why is there nothing in it about immigration? What right have the Americans to tell us that we must not discriminate against the free movement of goods when they are discriminating against the free movement of persons? Will they take 5,000,000 refugees? I think we want to know where these fine principles of the Americans—which I very much admire—begin, and where they end. I think the right hon. Gentleman the President of the Board of Trade would have done the House a great service if he had been a bit more frank about the omissions from that document. We are in a fix, because this document has approval from His Majesty's Government as a basis of negotiations. That puts us in a quandary in which we ought not to have been put.
What can we do about it? I have a suggestion to make, though a very humble one. I start upon the proposition that foreign policy ought to be above party politics. I go on to say that commercial policy is an integral part of foreign policy. But when the Government come to translate that Command Paper 6709 into treaties, they will not have behind them, as they ought to have, the support of all the major parties in the country. Therefore the Government ought to discuss the principles underlying the future of our trade with men of experience on all sides of the House before they go to these conferences, otherwise we on this side of the House can do nothing less than my right hon. Friend the Member for West Bristol (Mr. Stanley) said, that is to say, reserve ourselves completely free. That, however, makes nonsense of the doctrine that foreign policy should have continuity and should be backed up by the whole of the people of the country. I suggest to the Government that they might well consider whether it is in the national interest to negotiate one half of British policy without giving all parties in the House a chance of forming their views upon the principles which underlie it.

Sir Arthur Salter: This Command Paper is, of course, put forward quite specifically as proposals for consideration. It is put forward by the United States of America, and, at the end of the documents His Majesty's Government say they are in full agreement on all the important points in these proposals. There is obviously a full, wide-open opportunity for His Majesty's Government to come forward at the appropriate times with their own proposals which could be married with and welded into the others.

Mr. Eccles: I am very glad the right hon. Member for Oxford University (Sir A. Salter) takes so optimistic a view. I think we cannot depart from the actual words at the end of the document which are that the major principles are approved, words which have been confirmed, I believe, by right hon. Gentlemen on the Government Front Bench in their speeches in this Debate. I say that is a party approach to foreign policy, and I doubt very much whether it is in the best interests of the country.
I wish 10 put one further point to the House. From these unsatisfactory documents we secure one great advantage. From now onwards there cannot be a man or woman in the country who does not see that the export trade is the nation's first priority, and that all the other sound objectives of policy that were listed at the General Election, housing, nationalisation, social reform and the rest, must now step down to make way for exports. Sooner or later events would have forced us to make a drastic change in the priorities that were listed last June and July. I think it is much better that it should be done now. These proposals throw down in front of the British people a tremendous challenge. We have faced challenges of that sort in our history before and we have come through, and we shall come through this time, but only provided that we base our action on the world as it is and not on the world as we would like it to be. I see this country, a small country but a country very rich in resources, standing between the revised imperialism of Russia and the commercial aggression of America. There is nothing surprising in that. In our time we have been actively imperialists and aggressively commercial. But the lesson of these documents is that our very best friends in the world today are young, ambitious and strictly realistic.

and if we want to maintain our position between them—and it is enormously to the advantage to the peace and prosperity of the world that we should—we, too must be ambitious and realistic, and we must temper our dreams of perfection and universal brotherhood to the winds that come from the West as well as those that come from the East. I have made my suggestion, and I sum up my whole argument in this way. We must have the loan; for very serious reasons it is inevitable. Then we can go on and have Bretton Woods, which is all right when the fair financial weather comes; but having done that, I think we ought to place the united experience of this country, which in these commercial matters is far greater than that of any other country in the world at the disposal of America and Russia and show them just how they can and should contribute to a real multilateral trading system as much as we have been asked to contribute in these one sided and obscure proposals.

6.22 p.m.

Mr. Max Aitken: I thank you, Sir, for calling on me at this moment. I feel sure that this is an occasion which is, more sincere than any other in the life of an hon. Member, the moment when he asks for the first time the indulgence of the House. I am sure I can count on the sympathy of hon. Members who have not yet embarked on their first flight, and I hope that I will gain the traditional tolerance of the older Parliamentary pilots who can perhaps remember their forebodings and trepidations at the moment when they embarked on their first solo.
The terms of this suggested loan are, in my opinion, harsh. I do not suggest that a Conservative Government would have got better terms than have been offered to the Socialist Government, but I do suggest that this country has done little to gain the support of the United States over the last four months. Poltical events have not created any warmth of feeling between the two countries. The Americans have seen this country give a great mandate to the Socialist Government. On the other hand, the Americans rather think that many people in this country regard them as super-mad capitalists, as men who have gone crazy in the pursuit of private enterprise without regard for stability, either interval or external. In my opinion we showed an utter lack of judgment two


weeks ago when we insisted upon the rates of the transatlantic air service being put up and insisted upon the Americans reducing their services when we have not even a service running across the Atlantic. It seems to me to be only too evident that cheap transportation and nationalisation go ill together. Then we turn to the Americans and say, "Will you please lend us some money?" Of course the terms are harsh. I suggest we can get better terms. I suggest that the Chancellor of the Exchequer should make immediately direct contact with the American Government and negotiate better terms. I suggest that he goes over the heads of experts and uses his charm and tact, which we have seen in this House, and which he has used on us to such good advantage. After all, the amount of the loan is not immense. It is not far from the total we spent in erecting factories and buying armaments in the United States before the war and during the first year of the war. Those armaments were used as the first bulwark of the Americans against the Nazis. It seems to me that that sum is not such a very great sum.
It is said that Congress will not sanction, and that the American people will not give this country, a better loan or a gift of dollars. I do not believe that for a minute. The youth of America came to this country to fight. Millions of young American G.I's travelled through this country. They saw this. country from a close viewpoint, they saw how we were working and how we were fighting, they saw the conditions under which we were being bombed. They knew that we were the only one of the three great nations to declare war for our faith and our cause. They are the youth of America, the true America, and I do not believe that those Americans who have now gone home want to shoot this country down into the ground.
The Chancellor of the Exchequer said yesterday that if we were now to refuse this loan we would have economic trouble and estrangement from America. In my experience, the Americans admire toughness, and I feel that if we now said to the Americans, "We will not take this loan, but will pull our belts in and hold out," then in three months' time the Americans, with their warehouses almost

filled up with goods, would come to us and say, "All right, what are your terms? What do you want? "They have got to export, and they must export to our markets, and it seems to me that they would have to come to us in time if we held.out. If we refuse this loan, are we going to have trouble with the Americans? I suggest the trouble will come when we default on this loan, as is bound to happen in the opinion of many eminent economists. That is when the trouble will come. "Twice in 20 years," will cry the Americans," and never again." They will retire into a shell of isolationism, bitterly disappointed in the traditional honesty and greatness of Great Britain.
Besides, our two countries have grown together, the Americans and Great Britain, side by side ever since the Civil War. After the Civil War we poured money into America to reconstruct that country. We reconstructed and helped them to get on their feet again. I am told that after the Civil War a pair of boots in America cost £40. They were lucky to have boots, I suppose, but they do not cost 40 now, and part of that is due to British money which went into America after the Civil War and built them up again. The American Monroe Doctrine was made possible only because the British Navy underwrote it, and in the last two wars they have come over here and fought alongside us as brothers. I cannot believe that they will not reconsider these terms.
I was brought up in the house of a great Imperialist. I have come to share his enthusiasm and all his tremendous pride in the present greatness of the British Empire, and in what we believe to be its future. I have shared in some of his triumphs, I have also shared some of his great disappointments. I have sat here for four months silent and expectant, but I would not like you, Sir, to think that my silence meant consent. I have been expectant and hopeful that I would hear from the Government Front Bench perhaps a policy on Empire, but we have heard nothing until now when they bring out a plan which will ditch Empire preference.
During the war I had the great honour of fighting in the air alongside aircrews from the Empire. In the Battle of Britain there was a small company of


them and they fought bravely and well. Throughout the war the young men of the Empire flocked into our Air Force as well as into the other Services and on my last operational sortie, which was made in 1945 from Scotland, we took off 100 aircraft strong and of the pilots and navigators of those aircraft, 80 per cent. were from the Dominions. They were not fighting for Canada or New Zealand, South Africa or Australia. They were fighting for the Empire. I believe that if the Empire was now asked to rally around this country, we would be able to tide over this desperate period and not have to take this disastrous loan. In conclusion, I would like to say that I admire the courage of the Members opposite who have spoken out against this Loan. I would like to say how glad I and many Members on this side of the House will be to see them in the Division Lobby voting against throwing away our faith and heritage.

6.27 p.m.

Mr. Gordon-Walker: I would like to congratulate the hon. Member for Holborn (Mr. Max Aitken) on an extremely effective first solo. He achieved something that is very difficult, and I am conscious of this myself, at this stage of the Debate. He made new and important points. I did not agree with all he said and I suppose he would be very sorry if I did, but he spoke with great effect and made forthright and honest points. The House will look forward to hearing from him again.
There has been a lot of talk in this Debate about our surrendering to the United States, of selling our birthright for a mess of dollars. It seems to me that that is based upon a very serious misconception of the Agreement before the House. What is true is that the Americans have forced a very hard bargain upon us. It is also true that they are going to make international trade in the future all the harder, because of the hard terms of the bargain. It is not true—it is the opposite of the truth—that they have forced us to surrender essential liberties to them, or anyone else. Under the Agreement, we and other countries actually get more liberties. We exchange effective liberties for what were quite illusory liberties. The essential economic liberties of a country today, are the liberties to devalue its currency and restrict imports in order to

reduce an adverse balance of trade. I think we may have to do Both those things.
I do agree on one point with the Opposition—I think it is the only good point that they have made—we are going purely by guess work when fixing the dollar-sterling rate. We may find by experience that we have to alter it, devalue our currency and restrict imports. People may think we have that liberty today, in a chaotic world. The hon. Member for East Aberdeen (Mr. Boothby) contended that we in this House had the power to devalue by Act of Parliament. In fact you could not do so. You could pass an Act of Parliament altering the rate of sterling in terms of dollars but there would be no way of stopping other countries chasing your rate down again. We went off the gold standard in 1931 and devalued sterling in terms of the dollar; in 1933 America went off the gold standard and in 1935 we were back to the old parity. We had no liberty to devalue. Other countries have the right to chase your currency down at will.
Devaluation is a relative term. It demands certain fixed points. One of the merits of the Bretton Woods Agreement is that they do give us those fixed points. Bretton Woods forbids any general devaluation except to this extent of ten per cent. I do not believe this ten per cent. is very important because every one can do that and you are still in the realm of illusory liberties. Beyond that ten per cent. free devaluation is no longer permitted. But there is devaluation permitted to redress fundamental disequilibrium. That gives you an effective liberty in exchange for an illusory one, stopping people devaluing except when there are proper conditions for devaluation. This is going to be for us a very important liberty indeed. The same thing applies to import restrictions. Exactly the same argument, and I need not repeat it in detail. If Members will look at the Proposals for the International Conference, Chapter II, Section (c) 1 and 2, they will find that exactly the same arguments apply. You get a fixed code of conduct with certain permissible departures from it—the right to restrict imports under certain conditions. They become real liberties instead of illusory ones. The only doubt I have at this point is what exactly fundamental disequilibrium means. I am very glad that the Government are


going to ask for an interpretative declaration. I "would like to ask first, Whom do we have to ask about this interpretative declaration; who gives the answer? Secondly, if this is a permissible question—What are the possibilities of the answer being"Yes"? It is most important to us that it should be this answer—that fundamental disequilibrium should mean a permanent unfavourable balance of trade.
The bad part of the Agreement is, undoubtedly, the credit that we have to take from America. I think a lot of misunderstood and mistaken views have been expressed about what is wrong with this credit. A lot of people say that it takes away Imperial preference. It is quite clear that it does nothing of the sort. But the credit itself has two very bad sides. It shortens the period of transition before we get to Bretton Woods, which is primarily designed for normal conditions. Here we are faced with a very simple choice. We are faced with a possible breakdown by accepting this condition, and, on the other hand, we are faced with a certain breakdown if we reject it. In the face of that, even though it is a hard and difficult term, we have no choice but to accept it. The other bad part of this credit is the transfer of £32,000,000 a year not arising out of current transactions. It is always difficult to move money about which does not arise out of current transactions.
The Americans have proved themselves in the past particularly bad at financing such movements, which do not arise out of current transactions. The best and only idea they have had for doing that has been to induce men at one end of the world arduously to dig gold from underground and take it across the Atlantic so that the Americans equally' arduously can bury it underground again. Those people who suggest that a commercial loan would have been better, are forgetting that a commercial loan would have involved a much larger transfer, not arising out of commercial transactions in the future, and also would have involved those payments starting at once and not five years from now. Against this difficulty of repayment, of transferring sums to America that do not arise out of current transactions, is the Bretton Woods bank. With regard to the Bretton Woods bank, one of my complaints is the extraordinary use of language. What is a bank is called a

fund, and what is a fund is called a bank. I suppose it is due to some vagary of the American language. I suppose it is part of the price we have to pay for this credit.
The Bretton Woods bank conception is an important one, because it facilitates long-term and untied loans. That means, I think, that loans contracted in dollars, do not have to be spent in dollars. If you borrow dollars from America, under the Bretton Woods bank, you can spend that money in sterling, francs or in any other way. That means that a method opens out by which America, if it is sensible, can finance repayments. Bretton Woods bank goes a good way towards meeting one of the most difficult and unfortunate aspects of this credit. I think, bad as it is, we have no choice but to accept it. We certainly do not have to praise it. But the Motion before the House does not praise it. Members opposite have spoken of the" welcomes" in the Motion before us but if you read it carefully there is only one "welcome" in the Motion. [An Hon. Member: "That is quite enough."] It does not welcome any particular document. It welcomes the initiative of the United States Government. It seems to me that the Opposition is improperly sheltering behind this one? welcome," in order to dodge the duties which should be discharged. The Opposition ought to make up their minds one way or another. Those not in favour of this Motion would sooner that they voted against us and discharged their duty rather than dodged behind this verbal argument based on the one word "welcome."
Of course, bad as this credit is, and we must accept it in the long run, we have to think in terms of the whole context of international trade of the future, I am sure here that the key is whether or not there will be an American slump. I think by far the greatest danger before the world today is the danger of an American slump. I regard it as a more imminent danger than the atom bomb, and in some ways more destructive. There is no geographical limit to the power of an American slump to destroy life, prosperity and property. If there is a slump, we must, of course, take measures to deal with it, and one of the merits of the Bretton Woods Agreement is that it permits us to take those measures. Some Members opposite seem eager to run into those measures which would protect you


in an American slump. Though I think we would be pretty strong in a slump, we would undoubtedly lower our standard of living, if we had to resort to those devices. We should not run ahead of time into the various restrictions permitted under Bretton Woods.
The supreme merit of the proposals before us—and we should have a more friendly, positive attitude to them—is that they do take positive steps to check an American slump, to remove the probability of this happening and to reduce its intensity should it occur. Under the proposals for the International Conference, America, for the first time in history, goes on public record as saying that it is its duty to preserve employment in its own country. It means that should there be an American slump, America will stand condemned before the whole world as having offended against international duty. Of course, these are only words, and words can always be broken. Bretton Woods has much more in it than that. The "scarce currency" clause seems to me to be of supreme importance, perhaps one of the most important steps in international trade that there has ever been. It condemns a favourable balance of trade as being just as bad as an unfavourable one, and that is a very great step forward indeed. It is not true that America could pump dollars into the Fund under Article VII. Members who hold a different view could not have read the qualifications of Article VII. It is the Fund, not America, that decides.
The most important part of the "scarce currency" clause is that, by it, America gives prior consent to the use of discriminatory measures against America itself should it get into a slump; prior consent to the rest of the world to use measures that would disrupt America's export trade. I think that is the most important point of all the matters before us, because I personally believe that there will be an American slump. There are all the indications of an economic slump coming in America. The hope of the world is that America will resort to gigantic and heroic action to cope with that slump, and it is for that reason that there is so much merit in the Agreement, and the proposals for the International Conference, because it is much more likely under the Agreement, that America will speedily resort to those gigantic

measures of the type that Lord Keynes talked about, and Roosevelt used in his New Deal and, thereby, limit the scope and intensity of the slump which is likely to come.
I think, therefore, that this is one of the positive things in the Agreement. It will make an important, an extremely? important, contribution to the peace of the world because if you want to outlaw war, you must outlaw slumps which let loose the major part of the psychological and material causes for war. This is fundamental. I am convinced that the Bretton Woods and the other Agreements are so constructed that they can result in the outlawry of slumps and, therefore, the ultimate outlawry of war. It is for that reason. that, though I have a heavy heart about the credit, I welcome these agreements as a whole, strongly and not luke-warmly, as it appears to be by some hon. Members on both sides of the House.

6.33 p.m.

Mr. John Edwards: By the time tonight is out each of us will have recorded his vote on the Motion before us, or will have disowned responsibility and left the decision to others. As one who is at present minded to support the Government, and who has no desire to sit on the fence even alongside the right hon. Gentleman the Member for West Bristol (Mr. Stanley), I thought I might venture to make my first speech in this place on the subject before us today. In the matters before us we have,. first, the Bretton Woods Agreement, not ideal, but desirable I believe in itself. Second, we have a series of far-reaching agenda on international trade, which, I believe, constitute a good beginning, and provide the basis on which we can look forward to a useful exchange of opinion when the proposed conferences are called. Then we have the loan Agreement which I support with considerable misgiving. It is a hard bargain, its terms are as harsh as they are humiliating, and I confess to some anxiety about the shortening of the transitional period to one year. I do not, however, think that the right hon. Member for West Bristol can legitimately ask my right hon. Friend the Chancellor of the Exchequer for further explanation of what would happen if the loan were refused. I checked my memory against the Official Report, and I found the Chancellor reported to the length of


two columns on what would happen if we did not secure the loan. I can see no other way. Therefore, I support the loan and the agreement on the principle of "needs must if the devil drives" or, if that is objectionable, on the view that "beggars cannot be choosers." The truth of the matter is, that whether we like it or not, we have to reconcile ourselves to the real mediocrity of our circumstances.
So much by way of introduction. Now may I state my main contention? It is my view that a large and progressive increase in the volume of world trade is to be desired—that may be so elementary as not to be worth saying. Further, that worldwide multilateral trading is wholly desirable for this country. We stand to gain more from it than any other country in the world, and bilateral arrangements should only be resorted to if a multilateral system is impossible. To secure such a worldwide system of multilateral trading, I believe that three things, at any rate, are needed. The first is that there should be a satisfactory foreign exchange system; the second that the major economic countries of the world should pursue full employment policies, and the third that the major countries of the world should agree standards of conduct in their economic relationships with one another.
Let me say a little, therefore, about the first of these. I say that we cannot have proper world trading unless we have a clearing system through which foreign exchange transactions can be effectively settled. Such a system is provided in the Bretton Woods Agreement, and if it were not, we should have to proceed to contrive something rather like it. Listening to some of the speeches of hon. Members I almost felt that they were denying the need for stability in foreign exchange rates. Whatever one may say about the classical gold standard, it was not without its advantages. It did give certainty in a field where certainty is most important. Stability in our exchange rates is, I suggest, desirable, and if there are to be alterations in exchange rates, then they should be made as infrequently as possible. I do not propose to follow the arguments advanced by hon. Members who have talked about the gold standard, except to say that, by no definition of which I am aware, in any of the current textbooks on economics, would it be possible to describe the Bretton Woods

arrangements as being those of a gold standard. However that may be, there is certainly nothing of laisser faire about Bretton Woods. It is essentially an attempt in the international management of currency. I have a feeling that the references that have been made by hon. Members in the Debate about the gold standard are calculated rather to divert attention from the issue. There was a time when gold was assumed to have certain magical properties, and there was a kind of fetichism about it. I thought, as I listened to the hon. Member for East Aberdeen (Mr. Boothby) and the hon. and gallant Member for Devizes (Squadron-Leader Hollis), that they were inclined to put gold forward as a universal bogy man.
It is an advantage of the Bretton Woods arrangement that while maintaining reasonable stability of exchange rates we are able to vary the rates of exchange at need. This is important, not only if we have the beginnings of a depression but also in order to be sure that we do not have to take on our internal price and wage structure the shocks that may-come with the vicissitudes of economic change. The right hon. Gentleman the Member for West Bristol referred to the percentage decline in the value of the £in 1931. He spoke of a figure of something over 20 percent. I think it would be unfair to ask Bretton Woods to be capable of standing up to a shock of that magnitude, the deepest depression that has ever occurred. I think, too, that we must realise that the whole intention of the documents we are considering tonight is to prevent that kind of thing from happening again.
One final point I would like to develop. I said that multilateral trading on a worldwide basis was the best.. I said that bilateralism should only be resorted to if all other things failed. There are those who have argued that trade restrictions and bilateralism were the causes of the reduction in world trade in the 'thirties. I think it might be truer to say that countries were driven to bilateralism and to restrictions of various kinds because of an earlier reduction in trade. We had, for example, our own Ottawa system of Imperial preference, essentially a protective device, following the economic blizzard. I do not share the enthusiasm of some Members for a system of Imperial


preference. I have examined as carefully as I could what results from Imperial preferences, but I cannot see any justification whatever for believing that they have ever expanded trade. I believe that at their very best they are but a device for diverting trade. It is difficult in the period of the 'thirties, following the Ottawa Agreement, to interpret trade figures with any great degree of accuracy. Certainly, all that followed Ottawa was that we were able to increase our imports from the Empire, that is to say, Empire exports went up but exports from the rest of the world to us went down. It is not surprising, therefore, that over the period 1928–38 our trade, our export to non-Empire countries, declined by over 40 percent.
I would like to say just a word on the apostles of Imperial autarchy or an enlarged sterling bloc. The hon. Gentleman the Member for East Aberdeen talked of "the alternative of the sterling bloc based upon the British Empire and fortified by the countries of Western Europe." I will not seek to argue whether such a bloc could, in fact, be brought into existence. I will only say that I would have expected the hon. Member to have examined the figures of the trade concerned before he had come to the conclusion that this was a practical alternative at all. He told us that, before the war, about one half of our exports were to the Empire, but what of the imports? What if, as the hon. Member for Holborn (Mr. Max Aitken) said, the Empire did rally round? I have extracted the figures for trading in the years 1938 and 1944. If we take the year 1944, the whole of the sterling group provided us with only 27 percent. of our total imports, and, from the rest of the world, we got 72 percent. If we go back to 1938 we find that the sterling group area provided us with only 33 percent. and the rest of the world with 67 percent. But it may be said we must increase the figures considerably, on account of the Western European countries. What do we find? I have also worked out the figures for the sterling bloc and the Monetary Agreement areas as well, and, taking them both together, it is true that, in 1938, only 51 percent. came from those areas which the hon. Member to whom I have referred suggested as the alternative.
This then is the worst possible moment to start discriminating against the non-sterling area. The United States can anyhow play this game much more effectively than we can. All things considered, it would be a great reproach against this Government if they did not, at this time, face the future with an expansionist view, and if they were not prepared to make their contribution to the setting up of a clearing system for foreign exchange and also indicate the lines upon which economic conduct between nations should be conducted. All these things, taken together, lead me to the conclusion that we ought, in all the circumstances, to give our support to the Government on these very difficult, critical and highly important subjects.

6.49 p.m.

Mr.Osborne: I do not know whether it is usual for a "near maiden" to congratulate a "real maiden," but, if it is permissible, I should like to offer very sincere congratulations to the hon. Member who has just spoken. He has given us a very reasonable and reasoned speech, and has brought back to me memories of the time when I was a student at the London School of Economics. He has taught me how much I have forgotten. I hope the House will have many opportunities of listening to him in future.
I have to report, Mr. Speaker, that, in your absence, I used an unparliamentary phrase, quite unwittingly, innocently and ignorantly. The hon. Lady the Member for Cannock (Miss Jennie Lee), who, I am sorry to say, has just left the House, rather accused hon. Members sitting on this side of the House of being here to put our party before our country. I want to say most emphatically that, us far as I am concerned, that is untrue. I hope to see the hon. Lady afterwards—[An Hon. Member: "Ask the Minister of Health."] Well, the hon. Lady has invited one hon. Member on this side to meet her, and why should not I also meet her? I would, however, like it to be made clear. I put on my election address—and the Leader of the House likes to wave them about—that, if I came to this House, it would be to put my country before party. I think it would be awfully bad for this House if we did not allow to our opponents the same degree of sincerity that we claim for ourselves. The hon. Lady also took upon


herself to assume that her party are the only people to represent the working man. Again, I contest that view.
May I make this personal statement? I started work at 14 years of age and every morning had to catch a 5.30 a.m. tram. There is nothing that hon. Members on the other side know about working, that I do not know myself. I have gone through it, and I do resent very strongly that pharisaical assumption that the working man's interests lie only on that side of the House. I think this is a time when we should look at the truth, and not just grin like the Cheshire cat. I want to bring this discussion down to the level of the ordinary man whom we all represent, and whose interests we want to see advanced. Suppose that these documents were sent to every elector in the country. How many would read them right through? Not one in 100. [Interruption.] It is quite true, that hon. Members themselves have not done so. Of those who did read them, how many would understand them? Not one in a thousand. Therefore, I ask the permission and indulgence of the House to bring this important discussion to the level of these ordinary people, whom I represent, and who live in villages tucked away in the hills of Lincolnshire.
The one thing that worries these people is why there is all this hurry, and why we have to make up our minds on so vital a subject, suddenly, in 48 hours. I lay the blame for this, right at the door of the Government. For three months or more, the Government have had their representatives over there, arguing out these difficult things. In the first two or three weeks, it was well known, both in America and over here, that things were going badly. They went on arguing and arguing, and finally brought in this Agreement. I accuse the Government of lacking courage, and of not saying to our representatives seven weeks ago, "Come home, and let us put the position before the people of this country." It would have been a difficult decision, requiring courage, and I think the Government lacked that courage. What would have happened? We could have had a joint meeting of both Houses of Parliament, with Lord Keynes to address us, and put the situation before us and before the whole country He could have told us what the alternatives were. As a matter

0f fact, I do not think it would be a bad thing if a joint meeting of both Houses could be arranged now, and if Lord Keynes were able to address us and tell us the trouble. But I do, as I say, accuse the Government of lacking courage, in not bringing our people home and giving us time to consider the matter.
There is a good deal of misunderstanding and misrepresentation about this. I think all hon. Members have had a copy of a paper, which came from some Left Wing source and which is addressed to all Members of Parliament, saying:
Read Bretton Woods.
 This document shows why a vote for Bretton Woods is, firstly, a vote against the true Labour movement and all that Labour generally stands for.
Well, that would not trouble me. It just shows the ignorance of this matter that exists in the country among the working people. Secondly, it says, that a vote for Bretton Woods—and, therefore, a vote for this Motion, make no mistake about that—
is a vote against the continuance of the British Empire.
Well, that is just rubbish.
 Thirdly, and most important, a vote for Bretton Woods, that is, a vote for the Government this time, is a vote for war with Russia.
That is typical of the irresponsible nonsense that is always coming from the Left. What I feel about it is this. [Interruption.] Do you think that I should be troubled about the troubles of the Labour Government?

Mr. Speaker: The hon. Member must not say "You." If he does so, he is referring to me.

Mr.Osborne: I am very sorry, and I beg your pardon, Mr. Speaker. I believe, and all of us believe, that this Agreement is an Agreement under duress. There is nobody on the other side of the House who, if we had had more time to discuss it and if there was any escape, would say a word for it. Any agreement under duress is good neither for lender nor borrower, and both of them will live to regret it. I would like to know what will the Government do with the money when they get it? Assuredly, they will get it, because of the strength of their three-line Whip.


To come to my final point, I am certain that this matter is far too serious to try to make political party capital out of it. I wonder if hon. Members on both sides remember one question that we all had to face during the election. If we could spend £14,000,000 a day on war, we were asked, why could we not spend £14,000,000 a day on peace? Do hon. Members remember that? This is the answer, in the White Paper. This series of White Papers, if they do nothing else, will make the country face hard, bitter, awkward economic facts, and, when we on this side of the House tried to explain that it would not be so easy, we were called anti-Socialist. What is the way out? May I remind hon. Members that five years ago this country faced Dunkirk, when it looked as if everything had been lost? But when the right hon. Gentleman the Member for Woodford (Mr. Churchill) called for a great effort by the whole nation we know what the response was. I believe this is our economic Dunkirk, and what I want to know is whether the Government have got a man equal to the Leader of the Opposition to do the job today, that the right hon. Gentleman did five years ago. There is only one way out of our impasse. and that is by sheer hard work and efficiency from everybody. I believe that there is a spirit in the country, on all sides, from employers and workers alike, to get as much as they can for as little as they can. That is the way that will lead us right into ruin. One of the first bosses I had to work for, and I had many, had, written up in his office, "There is no fun like work." That is perfectly true, but the country has to realise that, unless we are prepared to work together—the whole lot of us, employers and employed—we are all going down the sink together.
The "Economist," which has been quoted many times, had a fine article on wages a week last Saturday which I suggest every hon. Member who has not already read it should go into the Library and read. I would quote one passage from it—it was about wages but it applies to today's Debate. Referring to the Labour Ministers it said:
 Their only way out is to explain to the rank and file of their followers what the economic necessities of the country are. They should preach the gospel of hard work and call for that response "—

This is not a laughing matter. [Hon. Members: "We are not laughing."] Then hon. Members are making queer noises—
 in raising output which alone can justify increases in wages.
I say that appeals should be made not only to the workers but to the employers as well. This country can no more afford inefficient workers than it can afford inefficient employers. The old Victorian idea of the "boss" who was there five minutes before the buzzer went in the morning, and stayed until five minutes after the buzzer went at night, is the type of "boss" we have to get if we are to pull through. No employer has a right to expect his people to work harder than he works himself. We must go down to our people and say, "There is no salvation anywhere unless we are prepared to take off our coats and really do an honest day's work. Otherwise we shall starve." If the Loan we are to get is frittered away and people are given the idea that they can sit back and take things easily because we are to have this money, the Loan will not be a help to us but a curse. Unless all of us in this House go back to our people and induce the idea of working, using this money wisely and getting down to it, there is no hope for us at all.

7.3 p.m.

Mr. Alfred Edwards: In spite of this Debate, in which we have had all the details of these papers before us expounded by experts from various angles, a good many of us who do not pretend to be experts feel a little puzzled about some parts of the scheme, and we feel that we ought to ask certain questions. I hope the Members of the Government who are to wind up the Debate will try to answer some of them. I have travelled a great deal in America, and I have always found there was one thing on which the Americans pride themselves above all else and that is what they call "talking turkey." It means putting very bluntly before their friends and opponents exactly what they mean, so that there is no possibility of misunderstanding. I see no reason why we should not "talk turkey" to Americans at this stage. I want to ask them this: "Are they going to carry out the letter and not the spirit of Lend-Lease? Has the war ended when the cost of war still continues?" We are unanimous here


that this is a bad Agreement—it is the best we can get, but it has been forced upon us, as has been said from both sides of the Houses—and a further question I should like to ask the Americans is, "Is this the way to treat your best customer—the best customer you have ever had or ever can have?"
Then I should like to ask, if the Agreement had been refused, what the Americans would have done with the material we have bought from them before. That is a question which has been asked several times and no one has answered it, but I hope those who are to wind up in this Debate will answer it. I do not know what the Americans could do with the material they have hitherto sold to us if they lost their best customer. They have repudiated the spirit of Lend-Lease. I go so far as to say that the greatest cause of the cost incurred in this war was American procrastination. That is true and I do not say it in an offensive manner. In two wars that has happened. They cannot get over the fact that the great cost and the greatest dangers have been due to the procrastination of America. As we continued absolutely alone for a year in holding the fort is it asking too much to ask that they should continue Lend-Lease for a brief period. after we have finished the fighting? I think not, and I should not be afraid to say that to America. That is what the Americans call "talking turkey," being plain and not misunderstanding one another. Have our negotiators really put it quite so plainly as that?
This is not mutual aid. It is not going to procure full employment. Why? Let us put this plain question to America. For five years we are to receive all these materials free of cost—in effect. Six years from now we have to begin to repay America. At the end of the fifth year we should say to America, "Will you kindly let us have a schedule "—or, as they would say, a schedule—" of the goods you require to be offered next year in repayment? "But then there is this document, according to which we are not allowed to do that. It is the one thing that is objected to. Are the American people then going to have an import surplus? Have we asked them that? Can anyone in this House, knowing the history of America and knowing the Americans at

this moment, really believe that they are going to say to themselves and the world at the end of six years, "We will reverse all our policy and have an import surplus "? It is no good our fooling ourselves. No other way can be evolved. Why do not we tell them this? Do they know it? They do not know it.
Let me relate an experience which 1 had early this year in the parlour of one of the big banks in New York, talking over the position with one of her leading bankers. I will try to summarise the discussion I had with him. I said, "I gather that what you want is that the financial centre of the world, the finance market, should be transferred from London to New York." His answer was, "I am afraid it is inevitable." I said, "As to insurance, which has been such a valuable invisible export to us for so long, I suppose you will be carrying your own in future." He replied, "Why should we send it to you when we can do it ourselves?" Then there was the question of shipbuilding. Shipbuilding has always been one of our principal industries—I know so well what happened on Tees-side when a previous Government allowed Shipbuilding Securities Ltd. to close down yards there. I told him that shipbuilding had always been one of our main industries and a big industry and asked, "Are you interested in shipbuilding? He said, "You had better talk to Mr. Kayser about that." I reminded him that we had finished up with so much less shipping than we started the war with and America now had so much more. As for the air, I said that America already had a monopoly, and I suppose they intended to maintain that, and he agreed. Then I said, "Tell me one thing. Have you considered how you are going to get paid for all these things in addition to all the rest?" And he said, "That is a question for those boys down in Washington."
It is always a question for the other fellow and I could not resist telling him this little story. During the war many Members of Parliament received inventions sent in by tame lunatics which we submitted to the Minister concerned, and the gentlemen in question were very pleased to receive letters of thanks bearing the Minister's signature. The prize one was the gentleman who went to the War Office and said, "What you have to do is to stop these 'ere V-bombs com-


ing over before they get to London. Make them turn round, go back, and explode in Germany, but, mind you, your experts will have to work out the details." The fact is that these gentlemen in America do not stop to think about international currency at all—except a few experts. If one reads the publications of the National Planning Association of America, there is no ambiguity at all, but who reads them? As far as I can gather, nobody in America, certainly no business man, or they could not talk the stupid nonsense that they do. Take President Roosevelt himself. In October, 1944, he said:
 I intend to find jobs for 60,000,000 Americans by trebling our exports.
Trebling their exports and getting £35,000,000 extra from us each year after the fifth year. How can they? Why have these gentlemen been in Washington so very long and taught those people over there so little? I do not know. We have heard a great deal from the experts yesterday and today. There are a good many Members of this House who are experts. However, it is not always the experts who know the right answers. I remember a famous evangelist in America who used to be taunted about his illiteracy. He had a good reply. He asked, "What is the sense of knowing such a lot, if what you know isn't so?" We have a perfect right, even if we are not experts, to make our contribution, to ask questions and to get answers.
I insist that, at the end of the fifth year, we shall have to know what America will take from this country. We must know sometime between now and then—I do not know whether the machinery is operating—to what extent she will take these imports. I met an American over here during the last few weeks, and in talking with the Board of Trade and the Treasury he wanted to send us foodstuffs to any amount; he wanted to spend all the money in this country. The people held up their hands in horror, and said, "You cannot do that; that is barter," as though there was something unholy about it, as though all trade was not barter.
I want to say, finally, to our American friends—and the word I shall use may be unparliamentary, Mr. Speaker—" This Agreement is pediculous." That is all I have to say to the Americans on this particular Agreement. They are hitting

people when they are down. It is like two survivors on a raft, and the physically strong is pushing off the raft the physically weak. I hope they will think again, realise what has been done for them, and see if they cannot give the quid pro quo which I do not see in these Agreements.

7.15 p.m.

Mr. Hopkin Morris: The hon. Member for East Aberdeen (Mr. Boothby) yesterday announced his intention of dividing the House upon this Motion. He did it in a powerful speech, but one which I think was dangerous, and all the more dangerous because it was delivered with such persuasion. It was dangerous on two grounds: first, it took too narrow a view of the issue with which we are confronted—too economic a view; in the second place it was built up on a false interpretation of the events of the interwar years. It is true that we all feel irritated with the terms of this loan, with the provisions of the Agreements, and there may be just cause for the irritation, but I venture to think that this is one of the great issues which ought not to be dealt with in an accounting spirit. It has to be dealt with in a much larger way, both by the United States and by ourselves. It is not merely a matter of agreements and some financial adjustments. There are times in politics and in the issues of nations when something else is called for. Reference has been made to the time when we stood alone in 1940, when we saved the whole world and, let it be remembered, we saved not only our friends but we saved our enemies no less surely. How are you to assess that service to mankind in terms of any financial treaty?
If you are to assess our position in 1940 by any merely rational test, we would have gone under. Supposing, for instance, that the right hon. Gentleman the Member for Woodford (Mr. Churchill) had stood at that Box in 1940, after Dunkirk, and had said, "Norway has fallen, Belgium has fallen, France has fallen; we have just managed to extricate our men from Dunkirk by the grace of God but we have no equipment in this country, we have nothing with which to face the foe; what are we to do?" It would have been a perfectly rational answer to say, "There is only one thing to do—make the best terms possible with the enemy." That would have been a


rational answer. I need not remind anyone who was sitting in this House then that that was not the speech he made. The speech which the right hon. Gentleman made, lifted it from the rational level to the level of the spirit of mankind. This House would not be meeting here tonight debating this issue, if he had not made that speech, which was made upon no rational ground. We and the United States today have to direct our minds to this issue—to the future welfare of mankind, to the future welfare of suffering Europe, to the future welfare of our own suffering people, to the prosperity of America itself, to the development of the East and the Far East. The responsibility rests upon us, and we shall not settle this problem by calling in the most expert accountants on one side or the other and leaving it to be discussed at that level. We have to decide this matter in a large way and trust to something beside the economist, however useful he may be.
That is not the only thing. I am not decrying the "Economist," I am not saying that the arrangement has no importance, but when the hon. Member for East Aberdeen condemns the financial provisions, upon what ground does he do so? Upon the basis of the inter-war years? He says, we are incurring a burden for 50 years of £100,000,000 a year, that we shall be compelled sooner or later to repudiate it, as the financial agreements in the previous inter-war years were repudiated. He points to the Imperial preference clauses and says these will be pared down without any guarantee by America that she will lower her tariffs. He asks what effect that will have upon our trade. Fifty percent. of our trade before the war was with the Dominions and the Colonies.? In looking at the position of this country and of the Empire, it is well to remember that Canada has already blessed the scheme, South Africa and New Zealand have blessed it, and Australia has an open mind. [Interruption.'] It has not expressed any opinion. If one looks at the map of the world, this country, geographically, is in Europe. Canada does not even belong to the dollar bloc; geographically, she is part of the American Continent. Australia has a ready market in the East. Does anybody contend that the greater prosperity of each adds to the prosperity of the

Empire? Is it contended that the Empire is kept together by tariffs? All this does is to alter the channels of trade, but it does not cement the Empire. We are not going to settle this business on that issue.
It may well be that America could have dealt with us in far more generous terms—I believe they could—but let us not be guilty of dealing with America in the same spirit as that which we condemn in America. This gives promise, at any rate, of widening the field. To consider the position in the nineteenth century, after the Congress of Vienna, up to 1914, Europe saw the longest period of peace in its history, the period with the greatest freedom of trade, the greatest prosperity, and the free movement of people no less than the free movement of goods. One could travel from one end of Europe to the other with nothing but a railway ticket. That was before 1914. Today, we have far greater means of travel and there are restrictions at every frontier. We cannot go without a passport, and there is the restriction on the movement of goods. Why did those financial agreements fail, one after the other, in the inter-war period? Because of any economic cause? Hon. Members should ask themselves that question. Was there any economic cause bringing about their failure? It is because all the agreements and all the modifications were made in a world preparing for war.

Vice-Admiral Taylor: Is the hon. Gentleman suggesting that Imperial preference was not a means of greater prosperity throughout the Empire and did not pull us through the results of the financial crisis?

Mr. Morris: Imperial preference may have been useful in a world preparing for war, but 50 percent. of our trade has been diverted to the Dominions and all our European markets have been lost. I ask that, before we dismiss this question, we shall give this larger consideration and realise the greater freedom which is at stake.

7.24 p.m.

Mr. Stokes: I propose to return to the questions that have been asked before and during the Debate and I want to supplement them. I want to emphasise to the Government our great sense of disappointment at what I call "this ugly


rush." Congress has had months to discuss this matter, and is going to take more months. The Bretton Woods proposals have been before this country, or known, for a considerable time. We have made repeated applications, particularly to the Coalition Government, to let us have lots of time in which to discuss them and yet no discussion has taken place despite specific promises. A most momentous decision has to be taken which is going to affect the history of the world and the lives of the people not forever, but for generations to come. In fact, by an unfortunate misunderstanding of what was to be the procedure in this House, we arc not going to discuss the Bretton Woods Agreement at all. It is a tragedy. I hope that even now the Government will not consider it too late to alter the date. There is nothing sacrosanct in 31st December, 1945. Why should they not send a telegram to the 44 nations who are going to subscribe and suggest putting 1; off until 31st March, 1946? Then we really would have time to consider its implications. Everybody would be much easier in mind. This is not just a question of persons, like myself, who are bitterly opposed to anything to do with gold; there are innumerable people who are gravely disturbed at the effect of this decision. I hope that at this late hour that point can be considered.
I want to show "the background from which I approach this matter, because I take a slightly different point of view from, I am afraid, most of the Members of my own party. I do not criticise them for holding their views. I am sure that they hold them sincerely and that the right hon. Gentlemen who initiated all these affairs have been honest, both in their intentions and their beliefs. My trouble is that I profoundly disagree with them. I am glad that we still live in a country where we can disagree and meet in this great Chamber and air our views on problems which are so historical. What I have at the back of my mind is, that, if we are to have peace in the world, we have so to arrange matters that the land and raw materials of the world arc used for the benefit of all mankind. That is what we want. What do we find? The Bretton Woods discussions which have been going on have had nothing whatever to do with that question. The discussion is always upon the question of how the monetary machine should be worked. It

may be an over-simplification, but it always seems like the situation which would arise if a corporation decided to run an extensive 'bus service all over the country, and, before deciding where the 'buses were going, or how many 'buses they would want, or what the fares would be, they sat down and discussed how many tickets they were going to print. We have got this the wrong way round. The hon. Gentleman the Member for East Aberdeen (Mr. Boothby) anticipated yesterday when he thought this would be my view. We have taken the wrong end first. We ought, first of all, to call together all the nations who are willing to co-operate to use their natural resources for the benefit of everybody. They should discover a way of doing that and make an agreement to say that it shall be done, then say "We will have no more of that wretched monetary machine which broke down everything before. We will design a monetary machine which will make the system work." I regret that the matter should be tackled the wrong way round.
Now for Bretton Woods. My notes are marked "Only touch on Bretton Woods—further Debate tomorrow." But by a dreadful mistake, this is not to happen and so I must take longer than I had intended. I do not propose to remain long in dealing with the matter of the gold standard. The Chancellor got himself out of the difficulty by keeping on repeating the fact that it is not "the" gold standard. I do not think that anybody said it was. I recognise that what is proposed is different from the gold standard which existed prior to 1939, and that standard was different from the one in 1914. It is no use people saying that it is not a gold standard. The House should. not take my authority for it, but Mr. Morgenthau, in presenting the Report on International Finance to Congress, said:
The Bretton Woods Plan marks the fruition of the American Treasury's Gold Policy.
Mr. Winthrop Aldrich, Chairman of Chase National Bank, describes the Bretton Woods Final Act as:
In England the proposal is termed the opposite of the Gold Standard.
In America a further application of the Gold Standard.


That is precisely what that is. I am not without support in this country. In the "Daily Herald "one day there appeared:
The feature of the arrangement that is likely to provoke the most intense discussion in this country is the linking of Britain to an international gold standard.
It is not good enough to try to slip out by saying this is not "the" gold standard. This is a gold standard, and if you have gold as a basis you are bound to break down in the end on account of its restrictive effect. My policy has always been against any return of any kind whatever to any form of the gold standard. The Chancellor of the Exchequer claims that we are no worse off under this system than we were under the old gold standard. I doubt that. I know that we are entitled under this arrangement to depreciate our currency, without asking, by 10 percent. He suggests that that is a considerable amount. I do not dispute it; but it is only 10 percent. He points out that by making application you can get a further 10 per cent., but by making application to whom?—application to an outside body on which the representation of the whole of the British Empire is only 24 percent. I do not think that percentage is enough anyway. I even hear arguments now that the £should be down to 2.50 dollars at the present time. In the black market you can probably get it lower than that. If we can be clearly convinced that this amount of devaluation is all right, I shall have to rest content. But the Macmillan Report said that 10 percent. was not enough and in paragraph 256 it says:
It is no doubt true that an essential attribute of a sovereign State is the power at any time to alter the value of its currency for any reason deemed to be in the national interest.
And that report was signed by Lord Keynes.
Such power and necessity should not be surrendered lightly. I look upon the proposals of the Bretton Woods Agreement as hitching us back to gold, and handing over what should be the sovereign right of our own people through Parliament to an outside irresponsible body. I, for one, on no occasion whatsoever will vote for that. I thought that when we had the great victory of 26th July that we were going to cut ourselves free, and now I find that having got rid we hope of the capitalist system in this country

we are going to tie ourselves up to the moneylenders of another.
The Chancellor of the Exchequer also argued that we can get out of the Agreement if we want to. But what does that mean? It means that we get boycotted by all the other members. He argued the ether day that if that happened things would be in such a bad state that others would come out with us, but that is the gambler's attitude, and I am not sure that we can rely on Canada and others finding it convenient to come out at the time we find it convenient to come out. As to the valuation of the £at 4.03 dollars, who can really say what the value of the £may be in six months or a year hence? No expert can. If he says he can he is irresponsible. I have worked in an engineering firm during all my life and I have always said "God save me from the experts." We all know that experts can be wrong. Thank God, we have not too many experts here. Unfortunately there are a great many out-side this House. I do not see how any expert can tell me what the pound sterling is going to be worth in 12 months' time or, for that matter, in six months' time. I do not believe that some of them even know what it is worth now!
I now come to the trade proposals. This is a most astonishing document. I often wonder who drew it up. I take it that it was a Coalition document, and that Members of the Opposition Front Bench had something to do with it at some time. Evidently from the phraseology on page 18 the Government are committed to it as a basis of discussion, but they are committed also further than that to implement the recommendations. I find is very difficult to understand what it all does mean, and with great respect to the President of the Board of Trade I was not very much clearer after he had finished speaking last night. I am not blaming him. It is a most complicated document. I am asked to receive it on Saturday, debate it on Wednesday and to give it approval without understanding what it is all about. The right hon. Gentleman talks about dealing with America in this matter but I feel he is a little bit too simple and trustful. In saying that I do not mean anything disrespectful to our great American cousins. I have been to America lots of times. I know that they are tough and I know that the majority


of them are extremely ignorant, they are in the adolescent stage. They are immature anyway, and they do not understand the international trade problem. My whole approach is towards these trade arrangements, and I welcome the idea of an international trade arrangement, but I want to be sure that it is the kind of arrangement that will bring about international planned economy so that everybody in the world benefits.
When I read this document I am bound to say that I do not think it does that. My complaint is not the complaint of the other side of the House. I have always been against Imperial preference. [An Hon. Member: "Disgraceful."] The hon. Gentleman may disagree with me, but I am an internationalist. I believe that the whole hope and salvation of the world is that we should all get together and share the good things available, and the only way to do that is by approaching this from the point of view of whether the nations are going to allow us to take such steps as will bring about that desirable end. There are three ways, amongst others, where I think things will go wrong.
Chapter III, Section E 2–3 in effect states:
 If engaged in State trading not to use it as a means of discrimination between countries in making purchases.
Section E.I in effect states:
 To regulate the dealing of any State trading enterprises solely by commercial consideration such as price, quality, marketability. …
In other words to run them in approved capitalistic manner.
By Section F.2 members are required
To place their monetary policies under the supervision of the International Monetary Fund in accordance with the requirements of Bretton Woods Agreement.
As I understand it, all this and more have been accepted without any reservation, and it is handing over to outside control not only our monetary relations but our trade relations as well. I sec no real planning of international trade in this document and certainly no Socialist use of State trade to obtain corresponding relationship with like-minded countries. The House ought to give consideration as to whether the Americans are really going to "play." Mr. Wallace in the "New York Herald" of 1st December said that America was in for four years of good trade: twice as good as in 1938. That

means in the minds of the Americans twice as good profit, with lots of unemployment about.
He went on to say that during the same period wages and salaries would drop by not less than 25,000,000,000 dollars or £6,000,000,000. He also said that by next year, 1946, there would be 7,000,000 unemployed. So that just at the moment when we are expecting the Americans to pull down their tariff walls we shall find that they will have 7,000,000 or more unemployed, all of whom would be extremely vocal, and it is most unlikely that we shall get them to entertain any kind of tariff reduction—rather the reverse. Their approach may very well be to put the tariff barrier higher in order to protect themselves still more.
I come to the Loan. As other Members have said, it is a dishonest thing to enter into a loan which one knows one cannot repay. I know we cannot pay this back because the whole American approach is wrong. The only way in which this Loan can be paid back is by America taking goods in exchange. Not only that; America has to become a surplus importer of goods, a surplus which must equal her overseas loans and interests. That is not her approach. The American thinks of the world as a glorious place in which he can dump all his surplus production to his best advantage and to the advantage of the rest of the world that can pay for them. He has not realised that the only fundamental safeguard, the only way the system will work in the end is by an exchange of goods for goods.
The Chancellor claimed that he had not got a mandate, when he went to the country, to put on more austerity. I ask him in all seriousness whether he had a mandate to involve us in a scheme which some of us think will land us in an inextricable trade situation which may well lead to war in the end. That is what I really believe about this policy. That is why I am fighting so forcibly.
The Chancellor asks, What are the alternatives? I propose to devote the rest of my speech to saying what I believe them to be. I ask a simple question, and I do not know why we should not have a direct answer. Has there been any suggestion for a straightforward commercial loan instead of this loan. I ask that for this reason: At one rime it was thought we would get a grant in aid. If ever a


grant in aid was possible then certainly a commercial loan was possible. Can I have an answer now? Has it ever been proposed to the Americans, or have the Americans ever offered to enter into a straightforward commercial loan instead of this loan with all its onerous and arduous burdens which none of us like? Will my hon. Friend answer that? I wish the Chancellor was here; it is a vital point. To my mind that is one of the alternatives.
The second is, Would it not be possible to arrange a loan in exchange for a British credit for raw materials to be supplied from the British Commonwealth to America at some future date? They consume lots of tin and rubber. Why is it not possible to arrange a loan to tide us over our immediate difficulty against goods which could be supplied from these areas at a later date? Has that been asked, or considered, and if so, what was the result? Thirdly, has any effort been made to get what I call a collective sterling group to approach the Americans with a view to getting a collective arrangement? Have the Dominions been consulted? It would seem to me that if the whole of the sterling group went as a body and said," What sort of arrangements can be made? "we should have got a much more satisfactory arrangement than is the case now.
I come to the fourth alternative. This is the austerity one. I am so certain in my mind that we are going down the wrong street, and are going to land in the state of affairs in which there will be another war, that I think if we are to commit ourselves to this disagreeable arrangement, the British people are entitled to know what the degree of austerity is to be. What is in the larder? I have raised this matter on several occasions. I have been told by competent Americans that a few months ago there were about 4,000,000 tons of food here in reserve. I was told the other day that there arc two years supply of tobacco here. Whether that is true I cannot verify. There are other measures which could be taken which the public has a right to know about before they are committed to a policy which may land us in the disaster of war.
I can think of other measures which could, with advantage to the dollar fund, be taken. We could easily cut down the

import of films. That would save £20,000,000 a year, and it would be a very good thing for the morals of the country as a whole, and would give our film trade a good fillip. We import tobacco of the order of £15,000,000 value a year from America. America takes £10,000,000 worth a year from Turkey. Why should we not encourage the British public to have a different taste from Virginian taste and take the tobacco from Turkey, bearing in mind that no self-respecting American smokes a Virginian cigarette; it is always a blended cigarette? Those two steps alone would bring about some considerable saving. On top of that I would say that I very much doubt if the Americans would be content not to go on supplying us with goods over the difficult period, even if we refuse to take this Loan. I do not see what they are going to do with the stuff otherwise. Europe is smashed under the Morgenthau plan, there is no demand there, and they must continue to develop this British market to the best of their ability. I do not believe that there will be no more clothes because there will be no cotton. What will they do with the cotton they have produced? What will they do with all the cotton workers in the Southern States if they don't send the cotton to us?
I come to my conclusion, which is first of all that America will learn after some of these debates that in the end she has to take goods, and not try to be the world's moneylender. What should be done with production is to reserve such goods as are required for direct exchange with other countries, and give the surplus away—which is what in fact happens when people default on their loans—without all the paraphernalia of the discomfort and unemployment which goes with that system. There is no need to be tied up to a rigid form of exchange and accountancy. That seems to me to be absolutely wrong. Before I came to the House the other night I switched en the wireless, and heard the statement that "the House of Commons is the instrument of the people in a very real sense." That thought ought to be displayed tonight. I regard this as an absolutely momentous occasion, because I believe that this Loan hitches us to the American bandwaggon, and may eventually land us in the position of being America's Heligoland off the coast of Europe, and because I believe it will in the end doom


civilisation to another blood bath I appeal to my colleagues to exercise that "very real sense," and vote against this Motion tonight.

7.50 p.m.

Mr. Churchill: Everyone is aware of the many objections to the Agreement which is now before us. The Government have in no way concealed their disappointment. They tell us that they have not been able to procure easier terms, and I think I may say that we wholeheartedly share their disappointment. Not only is there disappointment, there is deep misgiving as to what the consequences will be and also of our ability, however hard we try, to discharge successfully the obligations now to be imposed upon us.
I shall not attempt to repeat in detail the complicated technical arguments with which those who are particularly versed in this matter have enriched the Debate. 1 will only repeat the salient objections which we all feel. The first affects the loan. I was astonished that the United States should think it worth while to exact the equivalent of 1.62 percent. interest from their debtor in the special circumstances in which we find ourselves. This interest charge can play a very small part in the economy of the United States. In so far as it operates at all, it must be a deterrent upon their exporting power. They will be taking British imports direct, or roundabout, in payment of the interest on the debt, instead of repayment for United States exports, which they desire and which it is in their interest to have continually increased. We are told that this is a commercial transaction and that the loan can only be viewed as a commercial transaction. I rather agree with what the hon. Member for Ipswich (Mr. Stokes) said. It is a great pity that a commercial transaction should be mixed up with other non-commercial transactions, such as the agreement at Bretton Woods, upon which we have to pass a Bill, or the Commercial Policy Declaration on which there is to be agreement between the two countries to approach together along concerted lines. All the arguments for treating the loan as a commercial transaction tell against linking with it acceptance of other extraneous, and altogether separate, agreements. It is a pity that we should have allowed a commercial loan agreement to be mixed up and linked up with other transactions. I do not like the mixture.
If we have misgivings in respect of the gold standard about Bretton Woods, or in respect of Imperial preference about the Commercial Policy Declaration, we are told, "You are getting the loan." When it comes to discussing the loan, we are told, "This is a commercial matter and cannot be presented to Congress on any other basis." If the United States had seen fit to say, "We will give a grant-in-aid," or even "a loan without interest equal to these disbursements in America paid by the British before Lend-Lease was in action," then it would have been to their interest to associate with so benevolent an act, agreements and understandings on other matters. As it is, we seem to have the worst of it both ways.
Everyone has drawn attention to the proposal to make sterling convertible into dollars within so short a time as 15 months, whereas at Bretton Woods, it was contemplated there should be a delay of as much as five years before we accept convertibility as a definite legal obligation, however much we might try, in the meanwhile, to accelerate the process in fact. From what I have heard stated in this Debate without challenge on either side of the House, and especially by my right hon. Friend the Member for Alder-shot (Mr. Lyttelton), this convertibility proposal within 15 months appears to be a proposition so doubtful and perilous that the best hope is that in practice it will defeat itself, and that it is in fact too bad to be true. There is a lot in this. The trees do not grow up to the sky, indeed, I have not found that to be so in a long life. That is the second obvious and salient point.
Thirdly, there are most objectionable provisions of the Commercial Policy Declaration which, for instance, require us, if we are incapable of finding dollars to pay for American imports of tobacco, cotton, or other commodities, to reduce also, in equal proportions, our imports from any alternative source. This is really a proposal upon which I earnestly trust the steady gaze of the just-minded people of the United States will be attentively fixed.
Finally, I resent, with every other hon. Member, the indecent haste with which these most serious complex matters are thrust before us, and have to be settled. There have been months of secret negotiation—each day there have been rumours


about them, which have been contradicted by the rumours of the day after. Now, suddenly, we are confronted with this set of complicated, grave, far-reaching White Papers, and we are told that we must accept them within a few days—indeed, within a limited number of Parliamentary hours. I make it a cause of complaint against the Government that they have let themselves be browbeaten in this matter of time. The date of 31st December for the ratification of the Bretton Woods Agreement has no special sanctity. It has no more sanctity than 31st March for the ending of our financial year. I well remember being brought up to believe that 31st March was a day of particular sanctity and that the world would come to an end unless things were done by 31st March. One year it happened that we could do nothing by 31st March, but the world went on quite happily. I say that the date of 31st December was fixed for convenience, and it could be altered for good reasons.
The United States have a strong attachment to the Bretton Woods Agreement, and even if Congress had to amend their Act or pass it again—I am not aware of what the procedure would be—just for the sake of altering the date for a month or two, it would not be asking very much in respect of an international instrument of such great consequence where 65 other nations are concerned. But whatever weight there may be in this difficulty, it is nothing comparable beside the question why the whole matter should not have been disclosed both to the American and British peoples now, and be given a couple of months in which to make up our minds and allow public opinion on both sides of the Atlantic to form itself on this subject. It might well be that some of the crude objections which exist, and which are obvious in these White Papers, might, by good will and mutual concession, have been smoothed away in the face of the public, and, at any rate, mature judgment could be formed by what are, after all, the representatives of the nation assembled here in the House of Commons.
I have never heard any valid or solid reason why the Bretton Woods date could not have been revised or extended, or why we should not have said, ",These matters must be laid before Parliament, and Parliament will require, at any rate,

a considerable time in which to consider them in the light of maturing public opinion." Such a request from a cherished friend and faithful ally could never, for any reason, have been used or made the ground for breaking off negotiations on this matter so indispensable to the two countries. Some risk would have been run in saying "No when the proper moment comes, in regard to time at any rate.
For these reasons, upon which it would be easy to expatiate, we on this side of the House refuse altogether to accept any responsibility for this set of transactions. We recognise that it is the duty of the Government to decide. In international matters it is always our desire to associate ourselves, so far as possible, with them. I very much regret that we cannot do so on this occasion. The task falls to me, as Leader of the Conservative Party, to give advice to my hon. Friends as to what our conduct should be in this present bleak and difficult situation. It would be a great pity and would weaken us for our future tasks, which are heavy, if we all voted in different Lobbies on a question of this kind.

Sir Waldron Smithers: Why?

Mr. Churchill: My hon. Friend asks why. I would have thought that even the simplest processes of ratiocination would enable him to supply the answer to that. We therefore thought it better and wiser to abstain as a body—[Hon. Members: "Why?"] For this reason. We thought it better and wiser to abstain as a body, and that is the course we intend to pursue.

The Secretary of State for Foreign Affairs (Mr. Bevin): How can you pursue it when you are sitting still?

Mr. Churchill: We are discussing the movements of the mind, and not the much more bulky shiftings of the human body. This course is thoroughly justifiable in an Opposition whose vote cannot, in any case, decide the issue. There is no reason at all why we should share the responsibility of the Government. The responsibility lies wholly upon them, and they have the power to, discharge it. Whatever we did with our votes in this House, we could not affect the position. [Interruption.] I am not asking for any advice


from below the Gangway on the opposite side of the House as to what I should say by way of guidance to my own supporters. How do I know it would not be prejudiced advice? How would I know that those smiling gentlemen would not be anxious to lure me into some trap? They should take their advice on party leadership to the eminent statesmen arrayed there in an uncomfortable line. We could not stop this arrangement if we were all united in wishing to do so. We are certainly not all united in wishing to stop it—that is a fact—any more than the party opposite arc all united in wishing it to go through.
On the other hand, I cannot understand why we—the Opposition, the minority—should be expected to come forward to approve and welcome a proposal which fills every party in the House with great anxiety, and which is only commended to us by the fear of an even darker alternative. It is for the Government and their great majority to bear the burden. I said the other day—[An Hon. Member: "What about 1939? "] It was said quick enough when it came to voting for conscription two months before the war. I said the other day out of doors that the vote at the General Election would turn out to be a disaster to the country. Undoubtedly, the hard terms of this loan arrangement are one aspect and one instalment of that disaster. Whatever may be said to the contrary, our relations with the United States have definitely become more distant and more difficult since the establishment—[Hon. Members: "No."] Hon. Members surely want to hear the case deployed, otherwise the great gifts of the Foreign Secretary will not have full scope in answering them.

Mr. Gallacher: You cannot blame me. I am sitting quiet.

Mr. Churchill: I am very glad there are no diversionary or distortionary tendencies evident in that quarter. Whatever may be said to the contrary, our relations have deteriorated. Both the great parties in the United States are wedded to the principle of free enterprise, and are opposed to the collectivist and totalitarian conceptions which underlie and animate Socialist policy. The fact that the United States is depicted as the last remaining haunt of capitalism, in a world which appears to them at the present time to be sinking and degenerating

into Socialism or worse, consciously or unconsciously affects public opinion over there, and it affects also the movement of political thought in the American Congress. This makes the United States Executive authorities more than ever careful of the form in which their proposals are brought before Congress. If they reached an agreement with us and were not able to carry it through Congress, not only their prestige but the competence of the United States Executive as a negotiating power would be affected", and whatever their good will—and it is; still very great—the Executive is inclined above all to protect itself from being stultified by a vote of the Legislature on a matter of grave international policy. Therefore, they safeguard themselves by taking every precaution, and in some cases double precaution, in the text of the documents which are made public.
It is this feeling which has told against us, and not any harsh sentiment or unworthy desire for material gain on the part of our American friends. [Hon. Members: "Oh."] We claim for our country that we fought from beginning to end, sacrificing everything for the common cause, allowing no thought for the morrow to conflict with the attainment of speedy victory. The United States may also claim, in spite of that expression of sentiment from below the Gangway, to have poured out their blood and treasure as a great fountain of Allied resistance to tyranny, and, long before they were themselves attacked by Japan, they rendered us invaluable aid through the great measure of Lend-Lease, that most unsordid act in the history of nations, under which they paid over £5,000 million in aiding and expanding our war effort in the common cause. Whatever complaints we make about these present proposals, whatever misgivings—and they are very serious—are aroused in our breasts, both their generosity and the championship by the United States of the cause of freedom will ever stand forth as a monument of human virtue and of future world hope.
I am very glad that no one of the slightest responsibility, speaking in this Debate, has used any language likely to reflect upon the noble deeds of the people and Government of America, to make ill-will between our two countries, or mar the splendour of the story of the past.


[Interruption.]1 am as good a judge, I assure the right hon. Gentleman, as he is of the effect of any particular word or action upon the opinion and sentiments of the people of the United States. I see he is contemplating a visit to that country in the near future. I trust that he will return fully informed in respect of the sentiments expressed over there. Neither must we underrate or fail to comprehend the point of view of the Congress and people of the United States. They see themselves confronted with a burden of internal debt amounting, I am told, to 262 thousand million dollars. That is about £65 thousand millions. Only their own gigantic exertions working unfettered and in free enterprise, can enable them to sustain and conquer.

Miss Lee: If there is that internal debt, does it not mean that some Americans have done what most Americans detest—some Americans have made a fat profit out of the war?

Mr. Churchill: I am not here to deal with the details of American administration, but very heavy excess profits duties were imposed there, as here, and even if individuals in a foreign country make profits in the course of the war, that is no reason for saying that we have not benefited greatly from the help received from that country, nor for denying our tribute of gratitude and respect. They see themselves confronted with this enormous burden of debt, they see across the Atlantic political conceptions and ideologies which they regard as widely divergent from the whole of their vast wealth-getting processes. It remains for the ineffable Mr. Laski to emphasise this aspect to them on various inopportune occasions. They have no doubt read of the dazzling expectations held out to the people of this country by those who have since been victorious at the polls, expectations which are not only of a far higher standard of life, but of a far easier life, than any that has existed in Britain before. They have, perhaps, heard talk of the 40-hour week from the T.U.C. Meanwhile, they themselves, although far better circumstanced than we are, have a host of difficulties upon them, which the most strenuous exertions of the whole vast impulse of the life-thrust of their production will be needed to overcome. While we feel acutely our position, we must not lose the

faculty of understanding that of other people. It is this flow of mutual comprehension which I regard as the most hopeful element in the future.
Many speak of the privations we should suffer if we did not receive this £1,000 million loan. That, in my view, is the least part. What I should regard as utterly fatal would be a prolonged rough and tumble struggle in the economic and financial sphere between the United States and the British Commonwealth of Nations and the sterling area. I am sure we should get the worst of it, and at the end would be found only another layer of economic wreckage. and ashes scattered over the tortured face of Europe and of Asia.
Moreover, the United States have an immense interest in the prosperity of Great Britain and of the British Empire, and their own prosperity could not survive for many years in the midst of a ruined world or in the presence of a ruined and broken Britain. It is in the working of these practical forces that we must put our trust for the future, and I am sure that it is along such paths and through such influences that a happy outcome will eventually be reached. United, these two countries can, without the slightest injury to other nations or to themselves, almost double each other's prosperity, and united they can surely double each other's power and safety. These matters must be carefully borne in mind by everybody who has to take a decision tonight.
Here I must digress for a moment upon a matter which I have not heard mentioned, but which should certainly be taken into consideration. Many hon. Members have said the American terms are severe; they are even harsh upon a debtor who has reduced himself to his unfortunate plight by his faithful, unstinted exertions in the common cause. But these considerations apply to other creditors as well as the United States. We are told we owe £1,200 million sterling to the Government of India and £400 million sterling to the Government of Egypt. No proposal has come from either of those countries similar to the great measure of Lend-Lease. Everything has been charged against us, without the slightest recognition of the common cause. In the case of Egypt, she would have been ravaged and pillaged by the Italian and German


armies, and would have suffered all the horrors and indignities of invasion and subjugation had it not been that we had defended her with our life's blood and our strong right arm. We are now told that we owe her £400 million sterling. Is there to be no reconsideration of that? Arc we not entitled to say, "Here is our counter-charge which we set forth for having defended you from the worst of horrors "? My colleagues in the late Coalition know quite well that this is no new idea of mine. The same arguments apply to the Government of India. I specially reserved this matter in the Cabinet in 1942, when I saw with disquietude these immense debts mounting against us night after night.
I sympathise with the United States line of argument in connection with the loan. They did not wish to be the only creditor of Britain who had to scale down his wartime credit and balances. I welcome the perfectly clear implications of these agreements that it would be right and proper for Great Britain to insist upon a proper scaling down of these war charges, and that it is unreasonable for the Americans to be expected to pay large sums of money across the exchange, not with the object of getting Britain on her feet again as a going concern, which is "a prime United States interest, but of enabling Britain to pay off other creditors against whom Britain has a far higher moral claim for easy treatment than she has against the United States. This, however, is all a matter which lies in our own hands and I do not pursue it further in this Debate.
For all these reasons I should deprecate most strongly any considerable number of the Members of the party I have the honour to lead casting their votes against the proposals which are now before the House. If individual Members have passionately strong conscientious views, no one can blame them for expressing those views in Debate or going into the Lobby, where they will find themselves with some odd companions, but any heavy vote by Conservative Members against the proposals would be specially injurious to our interests in America. It would be a gratuitous assumption of responsibilities which we have no need to seek and no power to bear. It would also be utterly futile and even wanton proceeding, and a weak yielding to emotions which the long interest of the State

requires should be stoically restrained. I would ask any of my supporters who may be inclined to cast their votes against these Measures to consider the possible reactions which a heavy Conservative vote against the proposals might produce across the Ocean and the altogether needless personal responsibilities which will go out of their way deliberately to incur.
There is one other point which every one of my friends will, I hope, bear in mind, namely, that we agreed together only yesterday upon a course of abstention, and that for a number of gentlemen to vote against the proposals, unless compelled to do so by profound conscientious conviction, would be in fact unfair treatment of other Conservatives who, but for the agreement to abstain, would have felt it their duty to vote with the Government. I ask, therefore, for general abstention on the part of my friends which will leave us unburdened with any responsibility for these proposals and at the same time keep our party free from any attitude of antagonism to the other great branch of the English-speaking world. The agreement among ourselves has been to abstain, but I must make it quite clear, as did my right hon. Friend the Member for the Scottish Universities (Sir J. Anderson), that by thus freeing ourselves from responsibility for the passing of these measures, in which we have never been consulted in the slightest degree—they were only flung at our heads last week—we do not in any way weaken public faith in the word of Britain.
The financial obligations once entered into by His Majesty's Government are binding upon all parties, even upon those who have not taken any part in affirming them. We shall have to do our very best, our very utmost, in future years to bear the heavy load. If we fail, it must not be from any lack of sincerity or exertion, but simply because the weight that is being placed upon us may be far more than our exporting power can sustain. Although in 1931 we had to default upon our American debt incurred in the first World War, nevertheless the character and conduct of our people, and the whole conduct of our State, is such that our name and honour still stand high in the world. Whatever criticism we may bring to bear on our own Government, it must be quite clearly understated that our refusal to share their responsibilities in no way re-


lieves us from facing the consequences of their decisions in a spirit of good faith and to the utmost limit of our strength.
Finally, there is one. point I must put on record about the Commercial Policy Declaration. At my first meeting with President Roosevelt at Argentia in 1941, I was very careful that the terms of the Atlantic Charter in no way prejudiced our rights to maintain the system of Imperial Preference. Those were not easy days. The United States were neutral. It was very hard to see how the war could be won, but even then I insisted upon that. Similarly when it came to the Mutual Aid Agreement, I received from President Roosevelt the explicit assurances which have since been published that we were no more committed by Article 7 to abandoning Imperial Preference than was the United States to abolish her tariffs. What we are committed to, and have been long committed to, in good faith and in good will, is to discuss both these matters. At the same time we are bound to take into consideration the views and wishes of the other Dominions of the Crown, and all has to be discussed at the forthcoming Conference in the light not only of the actions and agreements of the English-speaking world, but also with regard to the general attitude of all other countries towards the removal of trade barriers and trade restrictions of all kinds.
Therefore, we have unquestionable latitude and discretion of judgment. Some have said that the United States might make what looks like a substantial diminution of tariffs already so high as to be prohibitive,and that then, although those tariffs still remain an effective barrier against our exports to America, we should be obliged to abandon or reduce our present preference. I could not agree with that view. On this side of the House we reserve the unlimited right of free judgment upon the issue as it appears, when definite, concrete proposals are before us. It is, therefore, in my view, quite untrue to say that we are at this time being committed by the Government to any abandonment of Imperial Preference and still less its elimination. Of course, if we find ourselves in the presence of proposals to effect a vast, sweeping reduction of tariffs and trade barriers and restrictions all over the world of a character to give a great exporting power to this island and to British shipping, which

is a vital element in the services we render to other countries and a vital feature in our means of earning our daily bread, if we are faced with that, then, undoubtedly, we should be confronted with a new situation to which we should have to do justice. It would be a situation about which our Dominions would have strong views as well as ourselves, and, at that moment alone, and only at that moment, the decision about Imperial Preference would come before us.
Such is my view and interpretation of all that has occurred with the United States and also—the Government will correct me if I am wrong—what is now to be agreed with them by His Majesty's Government. I make no concealment of my personal view that if all this came to pass the vision before mankind to be would be brighter than we imagine. I do not see any probability of such a point being reached. It is more likely, on the other hand, that tariffs and trade restrictions of all kinds, even though reduced, will still be maintained at levels which severely hamper progress towards the ideal of the free interchange for mutual advantage of goods and services throughout the world. In that case, no one could in good faith demand of us to forgo the immense moral and material advantages which have flowed to us by the special development and fostering of inter-Imperial trade. The Commercial Agreement—I shall only be a very few minutes more because I want to divide the time with other right hon. Gentlemen—is not before us today. It has not been made and, therefore, how can we be committed? It is, of course, the Commercial Policy Declaration which, it appears, is to be interpreted as coming within the provisions of Article VII of the Mutual Aid Agreement by which we are bound. But beyond this, the Government obviously cannot at this stage be held committed to any details of some arrangement to be arrived at until after prolonged discussion at some future time. I agree that the Government should proceed to try and make a good commercial agreement for improving the future trade of the world, but Parliament must reserve to itself the fullest right and freedom to judge on broad and high grounds any definite proposals which are laid before them.
Having regard to all these facts, some of which are common ground between


the Government and the Opposition and which constitute the British position, now made clear and manifest to the United States, I cannot see there is the slightest justification for suggesting that we are compromised and fettered in any way in respect of Imperial preference. This applies not only to His Majesty's Government, but in a still more particular sense to the Conservative Party and to the Opposition who stand aside from the actual decisions tonight. On all these grounds, therefore, I counsel and urge my friends on this side of the House to follow unitedly the course we have agreed upon together, namely, of disclaiming all responsibility for the proposals of His Majesty's Government by abstaining from voting, but not, on any account, to incur responsibility about them by voting against them, and, finally, while respecting all solemn financial obligations of the State, to preserve the fullest freedom of action about all other matters that may be brought before us in the future.

8.37 p.m.

The Secretary of State for Foreign Affairs (Mr. Ernest Bevin): I never thought that I should meet my right hon. Friend in the capacity of an abstainer. I have never heard a more pleading speech for every drunkard to be sober than I have heard from my right hon. Friend tonight—at least until the Division is over. In view of what he said about our relations with America, the enthusiasm in Moscow for the Socialists must be immense. I recognise that the House is debating what may be regarded as a very grave issue, and I will try in my reply to be as logical as I can and not to resort to mixed metaphors, and, if I may say so to my old friend, to a little muddled thinking such as he has exhibited in his speech tonight. I know the task of facing this loan leaves a good many people with a sense of discomfort. I do not know anybody who ever came away from a moneylender's office and calculated the repayment who ever felt comfortable. I imagine that you might call in at the corner and have one and then, when you begin to see what the weekly repayment is, you begin to wonder, and it does not seem such a joyous event after all. But this discomfort is added to when the catastrophe falls upon you after you have been a moneylender yourself for so long and then have to borrow.
Great Britain has been a moneylender for a long time and most people have come to the City of London as supplicants. Having been in that position and then to find yourself going to Washington as a supplicant rather changes the situation. I can imagine it calls forth all the resistance and every possible feeling inherent in our breasts. I have not had the chance, owing to other duties, of following the Debate in the House, but I have tried to read, just to fill up my spare time, the report in Hansard as far as I can. Somehow, I rather feel there must have been a kind of re-echo of our feelings in the minds of New Zealand and Australia when they first elected a Labour Government. My right hon. Friend the Member for Aldershot (Mr. Lyttelton)was, I think, in the swim as well when all the city magnates looked upon this horrible little Government and then ended up in the most perfect and suave manner offering 5 or 6 percent. We have got into this difficulty not through our own fault, as the right hon. Gentleman said. But when you do get into difficulties you have got to get out of them.
It must be remembered that we have lived on foreign investments in which others have toiled to produce interest on the money we have lent, and so contributed to the wealth of this country. No one more than my right hon. Friend, as an ex-Chancellor of the Exchequer, knows better what it is to stand at this Box and to feel elated at the amount that has come in to help the Budget from the people all over the world who have had to pay interest on loans to Great Britain hitherto.

Mr. Lyttelton: Those were loans for productive enterprises.

Mr. Bevin: That is just what this is. This is not a loan to pay a war debt; this is a loan for food and machinery. That is the difference, and nobody more than my right hon. Friend the Member for Aldershot laid emphasis, in the Debate on the Gracious Speech, on the fact that we must borrow money from America, at interest or without interest, or else get a gift. Well, we have not got it without interest, and we have not got it as a gift. But we have adopted the third method and borrowed the money.

An Hon. Member: Will the right hon. Gentleman address himself to the very vital point of the parity with sterling?

Mr. Bevin: Do not try to make my speech for me. Wait until I come to that point. I will come to it in a moment. I beg your pardon if I said something wrong. If the hon. Member will wait I will develop my statement. But I have done exactly what the hon. Member for Aldershot suggested. What is he complaining about? Does he say that if he and his friends had been in office they would have got better terms?

Hon. Members: Yes.

Mr. Bevin: Is that your claim? I demand an answer.

Mr. Churchill: I certainly am of the opinion that we should have got better terms.

Mr. Bevin:: Then that is a libel on the Administration of the United States. We have not been dealing with New York bankers, we have been dealing with the actual elected representatives of America, and I will not believe, nor will I have it said about them without challenge, that the American Government conduct their foreign policy in the light of a change of Government brought about by the free vote of the people of Great Britain. Why has the difficulty arisen with the Balkans? Why has it arisen between other countries of Europe and the United States? Not because of the character of the Governments those countries have. elected but because of the question as to whether there have been free elections to elect those Governments. If that is so, what a thing has been said of another friendly Government. The egoism of it, the actual boastfulness of my right hon. Friend, the horrible assumption that the American Government would get down on its knees to him because there was a Labour Government in power here. It is utter nonsense.
But I can understand the shock to many right hon. Gentlemen in this House, and of those hon. Gentlemen particularly who have been lenders hitherto. Yes, lenders. I know the feeling when you cannot feel that you are top dog any longer. I know the reaction; I have gone through it more than once. It is a great experience and you are feeling it. For 20 years you were on top, and the blow which you received must have been terrific. But I feel myself tonight more in the position that I have been in

so many times in my career when facing the members of my own organisation, the trade unionists of this country, with agreements that I did not entirely like. That has happened on thousands of occasions in the last 30 years. To one of them the right hon. Member for Wood-ford (Mr. Churchill) contributed in no small degree. I had to face thousands of members in this country with cuts in wages, and I had to do it because of the action of the right hon. Gentleman and his friends. Circumstances were too much for me. I say that international circumstances are too great for the Government now to avoid facing this issue. And I say to my own party: "Let them abstain. But do not let us have any cowards on this side." There must be no failure to take a decision. The decision is the thing. My right hon. Friend will agree that it was decision that carried us from 1940 to the end of the war. And it is decision that will carry us through now. We have got to take the decision. The fact is that we have got to borrow and we are not in a position to dictate terms. Therefore we have had to negotiate. Hon. Members have spoken as if they had only to go to the United States and say, "Stand and deliver on our terms," and they would then get the agreement' they wanted. There is not one single Member who has put forward a proposal or a claim that they could have got better terms.

Sir J. Lucas: rose—

Mr. Bevin: I am not going to give way. Then I noticed that my right hon. Friend, for whom I have the most profound and long standing respect—I do not see him in his place—the right hon. Member for the Scottish Universities (Sir J. Anderson) said that he and his friends are really going to abstain because the word "welcome" was in the Resolution. And let me quote his actual words:
my right hon. Friends and I have concluded that we should not oppose the Motion which is before the House, if it is carried to a Division. On the other hand, we will not vote for it, and we advise our supporters similarly to abstain. We take that middle course, not merely because the measures necessary to the success of the plan, as I have said, are so completely under the control of the Government, but also, and mainly, because there are words in the Resolution as drafted which make it extremely difficult for us to give it support. I refer to the word ' welcomes ' which seems to import, at any rate in my


view, a note of enthusiasm that goes tar beyond anything we really feel."—[OFFICIAL REPORT, 12th December, 1945; Vol. 417, c. 455.]
Where does the word "welcome" come in the Motion? The Motion welcomes the initiative of the Government of the United States in making proposals for an international trade organisation. [Hon. Members: "Read on."] All right, I am reading on. Must I understand, at this late hour, after all the efforts of the ex-Chancellor himself, that to enter this international trade organisation is a bad thing and that the initiative of the United States was wrong? Do the Conservatives think it was wrong? Everybody in the House, for months past, has been urging international co-operation. Now that the United States has taken the initial step of promoting an international trade organisation, are they wrong? I think the United States is entitled to an answer from a person who held such responsible office for so long a period of those very negotiations.
When did the negotiations begin which led to these proposals? In 1941, with the right hon. Gentleman the Member for Woodford. That is where it began, and I do not complain. The right hon. Gentleman was up against it. I was with him in it. I shared every decision he took, and I do not go back on one. We were fighting for our lives. That great meeting which the right hon. Gentleman held at Newfoundland at that time, I regard, if I may say so, as the great turning-point of a most desperate situation. How glad we were to welcome the right hon. Gentleman back and to see what had been accomplished. Neither the right hon. Gentleman nor myself was under any delusion as to the price that ultimately had to be paid—perhaps for our lives. The price that ultimately had to be paid was Article VII, and we knew it, and, believe me, at that time, we would have paid the price of Article VII in a much more drastic form than it is now. I would have paid it for the liberty of the" world rather than be defeated.

Mr. Churchill: The position of Imperial preference was absolutely safeguarded by me under Article VII and by the insertion of the words in the Atlantic Charter "without prejudice to existing obligations."

Mr. Bevin: I am talking to the right hon. Gentleman about trade agreements.
I will deal with Imperial preference in a moment. I am not criticising him, believe me. I say that, at that moment, I would have done what he did. I will go further tonight, and, from this Box, will say that, even if we had been pressed to sacrifice Imperial preference, rather than be defeated by Hitler, I would have paid that price then in 1941. I know the issue that was at stake, but we did not have to pay the price, and, may I remind the House, we have not paid it now and it is not in these proposals. In his book, "The Dawn of Liberation," the right hon. Gentleman said:
 Again, in February, 1942, when the United States was our closest ally, I did not agree to Article VII of the Mutual Aid Agreement without having previously obtained from the President the definite assurance that we were no more committed to the abolition of Imperial Preference than the American Government were committed to the abolition of their high protective tariffs. The discussions on how great a volume and more harmonious flow of trade could be created in the postwar years under the Agreement leaves us in every respect, so far as action is concerned, perfectly free.

Mr. Churchill: Is not that so now?

Mr. Bevin: Exactly. That is the basis of this Agreement on Imperial preference—not whether the tariff goes down 40 or 50 percent. but on trade for trade on the merits of trade. That is how I understand it. It is, indeed, on exactly the same basis as the right hon. Gentleman the Member for West Bristol (Mr. Stanley) negotiated the 1938 Agreement, by which he reduced preferences as against tariffs at that time.

Mr. Stanley: indicated dissent.

Mr. Bevin: Therefore, it is to be discussed. I think that, when we are in a difficulty of this kind, it is a good method to put oneself in the place of the other person with whom one has been negotiating. I do not think it is wise merely to bolster up one's own mind and one's own case without looking at it exactly as the other person looks at it, and I think it is only fair to the United States to try to look at it from their point of view. All the discussion I have read, of yesterday's Debate particularly, forgets that there are two sides to this story. The right hon. Gentleman referred briefly to them just now, but that was the first time I had heard of them.
A representative of the Americans would say: "The total of Lend-Lease


from: U.S.A. to the United Kingdom, including services, was 20 billion dollars. These dollars were hard goods. Return Lend-Lease from the United Kingdom to the United States was equal to about five billion dollars. Some of this covered intangible things—as well as sites, hospitals and things of that sort. All this leaves a balance of 15 billion dollars to put into the pool with which we carried on the war, or about three times the amount borrowed from the United States in the 1914–1918 war. Under the Lend-Lease agreement, certain things were written off, and the present Agreement constitutes a cancellation of a substantial part of this 15 billion dollars." That is how the Agreement is looked at from the American angle. Now, what were the terms of the Lend-Lease Act, as passed by Congress?
 The terms and conditions upon which any such foreign Government receives any aid authorised in subsection (a) shall be those which the President deems satisfactory and a benefit to the United States, made in payment or repayment in kind or property or any other direct or indirect benefit which the President deems satisfactory.
As against this, it has been the basis of the argument that we have tried to get Lend Lease written off retrospectively. The whole struggle in these negotiations has been an endeavour to get it made restrospective.
The Americans well know our point of view. We stood alone in 1940. It was then we really got into this trouble—to almost the exact amount which we are now seeking to borrow. But we failed to achieve that, and there are many arguments on the American side which I do not propose to go into tonight which have to be taken into account. I ask the right hon. Gentleman who held my position before me whether it is not a great gain to us internationally to clear up Lend-Lease, war debts, all the arguments—to have finished with that at the price of 650 million dollars? I say, looking back over the history of my predecessors and the predecessors in office of hon. Members opposite, if we could have cleared off the whole of a great debt of this character at the cost of 650 million dollars the effect on our subsequent dealings in foreign policy would have been of tremendous benefit between the two wars.
It has been said that this is a "Baldwin Settlement "; but how can it be compared with the Baldwin position? The basis of the financing of the 1914 war was entirely different. We borrowed, we lent to others, we made an agreement to pay back, but the others did not pay us. That was the difficulty. I am not criticising Lord Baldwin; he had to face facts then of which I know little. He had to face it as a debt. Last time it was a war debt with nothing behind it—no goods, no machines—and if we had had to face anything like that this time we would have been sunk. We could not have done it. To compare two sets of circumstances where the analogy is so different does not really lead us anywhere at all.
It is true that Lend-Lease has altered our economy, but I have to look at the matter as Foreign Secretary and I say to myself, "How can the world get started? "That is the great anxiety. What part has Britain got to play? It is said that we ought to anchor ourselves completely to the sterling area, but what is the difference in the convertibility under this Agreement and the convertibility in 1939? They are precisely the same. The alteration of the convertibility was a wartime measure, and you would have great difficulty in standing up to another country and saying, "You all agreed to this sterling pool during the war, to win the war, and now, when you want free trade, you stand to the sterling pool still."

Mr. Boothby: I must point out that there is a great difference between 1939 and today. In 1939 the sterling area moved all their exchanges together. Under the present proposals we shall all be compelled to move our exchanges separately.

Mr. Bevin:: That is quite untrue, and if the hon. Member would study the thing he would not be so dogmatic. There is another problem affecting the sterling area. If my right hon. Friends the Chancellor of the Exchequer and the President of the Board of Trade, or any Government, whether us or the Opposition, could say to everybody in the sterling area, "Don't buy for two and a half years, keep your orders down," it would be a very simple matter. But they have been waiting for six years for goods.
The Government considered this very carefully and lengthily, we did not come to the decision without very great care,


and 1 became convinced in the end of the rightness of the ex-Chancellor's point of view, which he impressed upon me so often when he was in office, that the sterling area under these conditions would not hold. If the sterling area did not hold, and the dollar position was not settled, that was economic war. And if you add to the troubles that we have to settle in this world arising out-of a world war, an economic war under those conditions, then I dread the consequences. In the end, I accepted, with my colleagues, this agreement because I believed I was doing the right thing for the world, taking all the factors into account. Whether this obligation to turn sterling into another currency breaks us soon or not, depends on whether we are able to satisfy our creditors with sterling goods. If they are satisfied with those, they will not buy dollar goods. I know we are handicapped. We are handicapped by the neglect of a great many industries, the loss of skill, and the neglect by this House of our people for 25 years. I know we have to catch up, and hon. Members who abstain tonight have a great deal of responsibility.
The hon. Member for East Aberdeen (Mr. Boothby) quoted my Blackpool speech, when I said that I would not be tied to gold and that no one would persuade me on this issue. Well, if I had a ship in narrow waters, even in Aberdeen, and there was a 10 percent. play from the anchor and then another 10 percent. and then free play, I would not feel my ship was very safe. I should not think the anchor was a real anchor. I am satisfied, as a member of the Macmillan Committee, that if we could have had this free play in 1931, we need never have got into this trouble. I feel that this is not the gold standard. I have the authority of the right hon. Gentleman the Member for the Scottish Universities, who tells me it is not the gold standard; I have the authority of the hon. Member for Aberdeen that it is the gold standard. I suggest they settle it on their way to Scotland.
Now if I may return for a moment to Imperial preference, why did we have the Ottawa Agreement? Will any Member of this House suggest that, if there had been no Ottawa Agreement, the Dominions would not have flown to the Mother Country's side? Not at all. The reason for the Ottawa Agreement was

perfectly simple; it was the last desperate step to counter the terrible effect of the report of the Cunliffe Committee in 1918 and 1919, in which Mr. Austen Chamberlain deflated 40 percent. in one day—and I had to accept £2 a week reduction in wages for my people at that time Then the right hon. Gentleman came along with another 12 per-cent, immediately I had settled that, and we had a general strike.

Mr. Churchill: That was an increase.

Mr. Bevin: No, that was in the war. In 1925 and 1926 you came along and altered the exchange rate by 12 ½ per cent. by returning to the fixed gold standard. You upset all the country—and you and I became firm friends for ever after. Really it was this terrible struggle against a bankers' paradise. What did it mean? It meant that we were working in terms of fixed gold. It did not matter how you increased production or what you did, that ruthless, relentless, automatic action of the gold standard stepped in, the cruellest system that ever man invented.

Mr. Boothby: And now you are going back to it.

Mr. Bevin: No, not even half way. If this thing is used as the gold standard was used, then, both America and ourselves, will land ourselves into a revolutionary position, inevitably. Therefore I am satisfied that under the rules which have been laid down and under the scheme which has been devised, providing those rules are played up to in a correct manner, the situation in which we found ourselves never need recur. It has been said that, inevitably, this will lead to another repudiation. That is in the hands of the United States, and nobody else. The United States say that they want freer trade, but freer trade does not only mean the lowering of a tariff barrier, it depends on the actual fact as to whether they buy goods. The trouble of the Baldwin settlement, as it is called, and the trouble that would arise under this settlement, will arise if we are not allowed to work off our debts. If the debts are allowed to be worked off, both with the United States and internationally, then this few billion dollar loan will not matter very much. It is the exchange, unfettered, with people purchasing these things and not putting barriers up that will ultimately solve the problem.


I recognise that this is a difficult decision to take. All I would say is we are nationalising certain industries. They ought to have been nationalised long ago. The industries are incompetent. I speak as one who knows a good deal about it. [Hon. Member: "Cables."] The cables were the biggest scandal ever carried out. That cable settlement was a disgrace, and when the time comes 1 think the country will be astonished at what happened. It wants new capital, new blood, new methods in a number of these basic industries, and I would say to this House: Carry the Bills as soon as you can. The country has decided. Let us give effect to it, because that will have a tremendous effect on the amount of money we have to borrow. Let private enterprise, now the issue has been declared and the line of demarcation has been drawn, get on wi

the rest. And I say to my trade union friends, managers, everybody—with the country up against an economic position very much like it was militarily in 1940, that now is the time for us to put our shoulders to the wheel and help this old country through as we did on that occasion.

Therefore, finally, I would urge that Members should reconsider whether they should abstain. Members should take their responsibility, especially now that peace has to be worked out. We have to stand-to and try to carry great burdens. Anyway, my final word is this: We stood together in 1940 and fought it through and Britain survived, and Britain shall still survive.

Question put:

The House divided: Ayes, 345; Noes, 98.

Division No. 50.]
AYES.
[9.15 p.m.


Adams, Capt. Richard (Balham)
Champion, A. J,
Ganley, Mrs. C. S.


Adams, W. T. (Hammersmith, South)
Channon, H.
George, Lady M. Lloyd (Anglesey)


Adamson, Mrs. J. L.
Chater, D.
Gibson, C. W.


Alexander, RI. Hon. A. V.
Chetwynd, Capt. G. R.
Gilzean, A.


Allen, A. C. (Bosworth)
Cluse, W. S.
Glanville, J. E. (Consett)


Allen, Scholefield (Crewe)
Cobb, F. A.
Gooch, E. G.


Allighan, Garry
Coldrick, W.
Goodrich, H. E.


Alpass, J. H.
Collick, P.
Gordon-Walker, P. C.


Anderson, A. (Motherwell)
Colman, Miss G. M.
Granville, E. (Eye)


Anderson, F. (Whitehaven)
Comyns, Dr. L.
Greenwood, Rt. Hon. A.


Attewell, H. C.
Cook, T F.
Grey, C. F.


Attlee, Rt. Hon. C. R.
Corlett, Dr. J.
Grierson, E.


Austin, H. L.
Crawley, Fit.-Lieut. A.
Griffiths, D. (Rother Valley)


Ayles, W. H.
Crossman, R. H. S.
Griffiths, Rt. Hon. J. (Llanelly)


Ayrton Gould, Mrs. B.
Daggar, G.
Griffiths, Capt. W. D. (Moss Side)


Bacon, Miss A.
Daines, P.
Gunter, Capt. R. J.


Baird, Capt. J.
Dalton, Rt. Hon. H.
Guy, W. H.


Balfour, A.
Davies, Edward (Burslem)
Haire, Fit.-Lieut. J. (Wycombe)


Barnes, Rt. Hon. A. J.
Davies, Clement (Montgomery)
Hall, Rt. Hon. G. H. (Aberdare)


Barstow, P. G.
Davies, Ernest (Enfield)
Hall, W. G. (Colne Valley)


Bartlett, V.
Davies, Haydn (St. Pancras, S.W.)
Hamilton, Lieut.-Col. R.


Barton, C.
Davies, R. J. (Westhoughton)
Hannan, W. (Maryhill)


Battley, J. R.
Davies, S. O. (Merthyr)
Hardy, E. A.


Bechervaise, A. E.
Deer, G.
Harris, H. Wilson


Belcher, J. W.
do Freitas, Geoffrey
Hastings, Dr. Somerville


Bellenger, F. J.
Diamond, J.
Haworth, J.


Benson, G.
Dobbie, w.
Henderson, A. (Kingswinford)


Berry, H.
Dodds, N. N.
Henderson, J. (Ardwick)


Beswick, Fit.-Lieut. F.
Driberg, T. E. N.
Herbison, Miss M.


Bevan, Rt. Hen. A. (Ebbw Vale)
Dugdale, J. (W. Bromwich)
Hewitson, Capt. M.


Bevin, Rt. Hon. E. (Wandsworth, C.)
Dumpleton, C. W.
Hicks, G.


Bing Capt. G. H. C.
Durbin, E. F. M.
Hinchingbrooke, Viscount


Binns, J.
Dye, S.
Hobson, C. R.


Birch, Lt.-Col. Nigel
Eccles, D. M.
Holman, P.


Blenkinsop, Capt. A.
Ede, Rt. Hon. J. C.
Hope, Lord J.


Blyton, W. R.
Edwards, A. (Middlesbrough, E.)
House, G.


Boardman, H
Edwards, Rt. Hon. Sir C. (Bedwellty
Hoy, J.


Bottomley, A. G.
Edwards, John (Blackburn)
Hubbard, T.


Bewden, Fig.-Offr. H. W.
Edwards, N. (Caerphilly)
Hudson, J. H. (Ealing, W.)


Bowen, R.
Edwards, W. J. (Whitechapel)
Hughes, Hector (Aberdeen, N.)


Bowles, F. G. (Nuneaton)
Evans, E. (Lowestoft) 
Hughes, Lt. H. D. (W'lverh'pton, W.)


Braddock, Mrs. E. M. (L"p'l, Exch'ge)
Ewart, R.
Hynd, H. (Hackney, C.)


Brook, D. (Halifax)
Fairhurst, F.
Hynd, J. B. (Attercliffe)


Brooks, T. J. (Rothwell)
Farthing, W. J.
Isaacs, Rt. Hon G. A.


Brown, George (Belper)
Fletcher, E. G. M. (Islington, E.)
Janner, B.


Brown, T. J. (Ince)
Foster, W. (Wigan)
Jeger, Capt. G. (Winchester)


Bruce, Mai. D. W. T.
Fraser, T. (Hamilton)
Jeger, Dr. S. W. (St. Pancras, S.E.)


Burden, T. W.
Freeman, Maj. J. (Watford)
Jones, A. C. (Shipley)


Burke, W. A.
Freeman, Peter (Newport)
Jones, D. T. (Hartlepools)


Byers, Lt.-Col. F.
Gaitskell, H. T. N.
Jones, P. Asterley


Chamberlain, R. A.
Gallacher, W.
Keenan, W.




Kenyon, C.
Noel- Buxton, Lady
Stamford, W.


Key, C. W.
O'Brien, T.
Steele, T.


King, E. M. 
Oldfield, W. H.
Stewart, Capt. Michael (Fulham, E.)


Kinghorn, Sqn.-Ldr, E.
Oliver, G. H.
Strachey, J.


Kinley, J.
Paling, Rt. Hon. Wilfred (Wentworth)
Strauss, G. R.


Kirby, B. V.
Paling, Will T. (Dewsbury)
Stross, Dr. B.


Lang, G.
Palmer, A. M. F.
Stubbs, A. E.


Lavers, S.
Pargiter, G. A.
Summerskill, Dr. Edith


Lawson, Rt. Hon. J. J.
Parker, J.
Swingler, Capt. S.


Lee, F. (Hulme)
Parkin, Flt.-Lieut, B. T.
Symonds, Maj. A. L.


Leonard, W.
Paton, Mrs. F. (Rushcliffe)
Taylor, H. B. (Mansfield)


Leslie, J. R.
Paton, J. (Norwich)
Taylor, R. J. (Morpeth)


Lewis, A. W. J. (Upton)
Pearson, A.
Taylor, Dr. S. (Barnet)


Lewis, J. (Bolton)
Peart, Capt. T. F.
Thomas Ivor (Keighley)


Lewis, T. (Southampton)
Perrins, W.
Thomas, I. 0. (Wrekin)


Lindgren, G. S.
Piratin, P.
Thomas, John R. (Dover)


Lindsay, K. M. (Comb'd Eng. Univ.)
Platts-Mills, J. F. F.
Thomas, George (Cardiff)


Lipton, Lt.-Col. M.
Poole, Major Cecil (Lichfield).
Thomson, Rt. Hn. G. R. (Ed'b'gh, E.)


Little, Dr. J.
Popplewell, E.
Thorneycroft, H. (Manchester, C.)


Logan, D. G.
Porter, E. (Warrington).
Thurtle, E.


Longden, F.
Porter, G. (Leeds).
Tiffany, S.


Lucas-Tooth, Sir H.
Pritt, D. N.
Tolley, L.


Lyne, A. W.
Proctor, W. T.
Tomlinson, Rt. Hon. G.


McAdam, W.
Pryde, D. J.
Turner-Samuels, M.


McAllister, G.
Pursey, Cmdr. H.
Ungoed-Thomas, L.


McEntee, V. La T.
Randall, H. E.
Vernon, Maj. W. F.


Mack, J. D.
Ranger, J.
Viant, S. P.


McKay, J. (Wallsend)
Rankin, J.
Wadsworth, G.


Mackay, R. W. G. (Hull, N.W.)
Rathbone, Miss Eleanor
Walkden, E.


Maclean, N. (Govan)
Rees-Williams, Lt.-Col. D. R.
Walker, G. H.


McLeavy, F.
Reeves, J.
Wallace, G. D. (Chislehurst)


MacMillan, M. K.
Reid, T. (Swindon)
Wallace, H. W. (Walthamstow, E.)


Macpherson, T. (Romford).
Rhodes, H.
Watkins, T. E.


Mainwaring. W. H.
Richards, R.
Watson, W. M.


Mallalieu, J. P. W.
Ridealgh, Mrs. M.
Webb, M. (Bradford, C.)


Manning, C. (Camberwell, N).
Robens, A.
Weitzman, D.


Manning, Mrs. L. (Epping).
Roberts, Sq.-Ldr. Emrys O, (M'rion'th;
Wells, P. L. (Faversham)


Marquand, H. A.
Roberts, Goronwy (Caernarvonshire)
Wells, Maj. W. T. (Walsall)


Marshall, F. (Brightside).
Roberts, W. (Cumberland, N.)
White, H. (Derbyshire, N.E.)


Mayhew, C. P.
Robertson, J. J. (Berwick)
Whiteley, Rt. Hon. W.


Medland, H. M.
Rogers, G. H. R.
Wigg, Col. G. E. C.


Medlicott, Brig. F.
Royle, C.
Wilkes, Maj. L.


Messer, F.
Salter, Rt. Hon. Sir J. A.
Wilkins, W. A.


Middleton, Mrs. L.
Sargood, R.
Wilkinson, Rt. Hon. Ellen


Mikardo, Ian
Scott-Elliott, W.
Willey, F. T. (Sunderland)


Mitchison, Maj. G. R.
Segal Sq-Ldr. S.
Willey, O. G. (Cleveland)


Monslow, W.
Sharp, Lt.-Col. G. M.
Williams, Rt. Hon. E. J. (Ogmore)


Montague, F.
Shawcross, Sir H. (St. Helens)
Williams, Rt. Hon. T. (Don Valley)


Moody, A. S.
Shinwell, Rt. Hon. E.
Williams, W. R. (Heston)


Morgan, Dr. H. B.
Shurmer, P.
Williamson, T.


Morley, R.
Silverman, J. (Erdington)
Willis, E.


Morris, Lt.-Col. H. (Sheffield, C.)
Silverman, S. S. (Nelson)
Wills, Mrs. E. A.


Morris, P. (Swansea, W.)
Simmons, C. J.
Wilmot, Rt. Hon. J.


Morris, Hopkin (Carmarthen)
Skeffington, A. M.
Wilson, J. H.


Morrison, Rt. Hon, H. (Lewisham, E.)
Skinnard, F. W.
Wise, Major F. J.


Mort, D. L.
Smith, Capt. C. (Colchester)
Woodburn, A.


Moyle, A.
Smith, Ellis (Stoke)
Woods, G. S.


Murray, J. D.
Smith, S. H. (Hull, S.W.)
Wyatt, Maj. W.


Nally, W.
Smith, T. (Normanton)
Yates, V. F.


Naylor, T. E.
Snow, Capt. J. W.
Young, Sir R. (Newton)


Neal, H. (Claycross)
Solley, L. J.
Younger, Maj. Hon. K. G.


Nichol, Mrs. M. E. (Bradford, N.)
Sorensen, R. W.
Zilliacus, K.


Nicholls, H. R. (Stratford)
Soskice, Maj. Sir F.



Noel-Baker, Capt. F. E. (Brentford)
Sparks, J. A.
TELLERS FOR THE AYES:


Noel-Baker, Rt. Hon. P. J. (Derby)
Spearman, A. G. M.
Mr. Mathers and




Mr. Collindridge




NOES.


Aitken, Hon. M.
Conant, Maj. R. J. E.
Foot, M. M.


Astor, Hon. M.
Cooper, Wing-Comdr. G.
Fox, Sqn.-Ldr. Sir G.


Baldwin, A. E.
Corbett, Lt.-Col. U. (Ludlow)
Fraser, Maj. H. C. P. (Stone)


Baxter, A. B.
Cove, W. G.
Fraser, Lt.-Col. Sir I. (Lonsdale)


Blackburn, Capt. A. R.
Crosthwaite-Eyre, Col. O. E.
Gammans, L. D.


Bossom, A. C.
Darling, Sir W. Y.
Glossop, C. W. H,


Bower, N.
De la Bère, R.
Gomme-Duncan, Col. A. G.


Braddock, T. (Mitcham)
Delargy, Captain H. J.
Grenfell, D. R.


Braithwaite, Lt.-Comdr. J. G.
Digby, Maj. S. Wingfield
Hannon, Sir P. (Moseley)


Brown, W. J. (Rugby)
Dodds-Parker, Col. A. D.
Hare, Lt.-Col. Hon. J. H. (W'dbridge)


Bullock, Capt. M.
Dower, E. L. G. (Caithness)
Harvey, Air-Comdre. A. V.


Callaghan, James
Duthie, W. S.
Herbert, Sir A. P.


Carson, E.
Edelman, M.
Holmes, Sir J. Stanley


Castle, Mrs. B. A.
Erroll, Col. F. J.
Joynson-Hicks, Lt.-Cdr. Hon. L. W.


Challen, Flt.-Lieut. C.
Evans, S. N. (Wednesbury)
Keeling, E. H.


Cocks, F. S.
Fletcher. W. (Bury)
Kendall, W. D.


Collins, V. J.
Follick, M.
Lancaster, Col. C. G.







Lee, Miss J. (Cannock)
Rayner, Brig. R.
Touche, G. C.


Levy, B. W.
Renton, D.
Turton, R. H.


Linstead, H. N.
Roberts, H. (Handsworth)
Ushorne, Henry


Lloyd, Brig. J. S. B. (Wirral)
Savery, Prof. D. L.
Vane, W. M. T.


McCallum, Maj. D.
Shawcross, C. N. (Widnes)
Wakefield, Sir W. W.


Macpherson, Maj. N. (Dumfries)
Shepherd, Lieut, W. S. (Bucklow).
Walker-Smith, Lt.-Col. D.


Mann, Mrs. J.
Smiles, Lt.-Col. Sir W.
Warbey, W. N.


Marlowe, A. A. H.
Smith, E. P. (Ashford)
Ward, Hon. G. R.


Marsden, Capt. A.
Smith, H. N. (Nottingham, S.)
Webbe, Sir H. (Abbey)


Mellor, Sir J.
Smithers, Sir W.
White, D. (Fareham)


Molson, A. H. E.
Stoddart-Scott, Col. M.
Wilcock, Group-Capt. C. A. B.


Moore, Lt.-Col. Sir T.
Stokes, R. R.
Williams, Lt.-Comdr. Gerald (T'nbr'ge)


Neven-Spence, Major Sir B.
Taylor, C. S. (Eastbourne)
York, C.


Noble, Comdr. A. H. P.
Taylor, Vice-Adm.E. A. (P'dd't'n, S.)



Nutting, Anthony
Teeling, Flt.-Lieut. W.
TELLERS FOR THE NOES:


Peto, Brig. C. H. M.
Thomson, Sir D. (Aberdeen, S.)
Mr. Boothby and


Prior-Palmer, Brig. O.
Thorneycroft, G. E. P. (Monmouth)
Squadron-Leader Hollis

Resolved:
That this House approves the financial arrangements between His Majesty's Government and the Government of the United States, including the final settlement of Lend-Lease and other claims arising out of the war, as set out in Cmd. 6708; welcomes the initiative of the Government of the United States in making ' Proposals for an International Trade Organisation,' Cmd. 6709, and approves the participation of His Majesty's Government in the discussions proposed with a view to arriving at an international agreement upon the basis of the suggestions put forward; and approves the proposals for setting up an International Monetary Fund and an International Bank for Reconstruction and Development as set out in Cmd. 6546 of 1944.

Orders of the Day — BRETTON WOODS AGREEMENTS BILL

Order for Second Reading read.

9.27 p.m.

Mr. Boothby: On a point of Order, Mr. Speaker. I would, with all due deference, submit this proposition to you. Repeated pledges have been given, as is generally admitted, by successive Governments, that we should have an opportunity of a full and free discussion of the Bretton Woods Agreement as such, but according to the Ruling you gave this afternoon, Sir, it will in fact be impossible for us to have such a full discussion. You said that out of your indulgence to the House, you would allow reference to be made to the Bretton Woods Agreement in the Debate today, and yesterday, but you said, Sir, that in fact as the Motion is now passed, it would be cut of Order to refer to Bretton Woods in the Second Reading Debate on the Bill. I submit that the logic of that is that if you had kept to the Rule, we should not have been allowed to discuss the Agreement on the Debate on the Motion, nor on the Second Reading of the Bill, because it follows a Resolution in favour of it.
I submit, with all due deference, that it is a very grave and serious Ruling to give that we shall not be allowed a full and free discussion on the merits of a Second Reading of the Bill. It means, in my submission, that vital decisions affecting the whole future of this country will, in future, have to be taken by Resolutions passed by this House based on White Papers and I am quite sure that, whatever may be the merits or demerits on this particular occasion, that is not a conclusion this House should agree to, or that you should rule without very serious consideration. This is a dangerous precedent, I submit. I venture to suggest for your serious consideration that the Second Reading of a Bill is a great opportunity accorded to this House for discussing the merits of a situation, and no Resolution passed in this House should ever be allowed to supplant the Second Reading of a Bill. If that is so, I think there is a strong case to put forward for the revival of the First Reading of a Bill. Otherwise, it seems to me there is no logical reason to prevent our going straight from a Resolution passed upon a White Paper to the Committee stage. I venture to submit that argument to you, Sir, with great respect.

Mr. Speaker: The hon. Member has put before me a long argument, but I am bound to say that I can find no grounds at all for the argument he has put forward. I must say that I have given the matter great consideration, and if I had not made that concession yesterday we couldnot have discussed Bretton Woods at all. It would not be in Order under this Bill, because, after all, this Bill is conditional on Bretton Woods being accepted, and Bretton Woods, being a treaty, is not debatable by this House. Therefore, I can find no grounds at all for the observations which the hon. Member has made. I can only inform


him that I have taken a great deal of advice on this matter, and this House cannot debate a matter on which it has already come to a conclusion. We have just now come to a conclusion on the Bretton Woods Agreement, and, therefore, discussion on it in connection with this Bill is ruled out entirely. In any case this Bill only deals with the financial arrangements. The diplomatic status of some persons and the enforceability of exchange contracts in the event of a treaty being decided are entirely hypothetical, and we cannot debate hypothetical matters. We can only debate those in the Bill itself.

Mr. Boothby: 1 can only say in view of your Ruling, Mr. Speaker, that I do charge the Government with a flagrant breach of the undertaking which has been given.

Mr. Stokes: On this point, may I submit this to you, Mr. Speaker? When this matter was raised by you yesterday, you said:
 According to the rule against anticipation, the fact that the Bill is before the House would prevent reference to it in the course of the Debate on the Motion.
You went on later to say:
 I am prepared, therefore, to relax the rule and to allow reference to the provisions of the Bill so far as is necessary for explaining the Agreement."—[Official Report, 12th December, 1945; Vol. 417, c. 422.]
I submit to you, Sir, that most hon. Members, or a great number, at any rate, thought that you would allow passing references but not full discussion. May I ask whether that was your intention, or whether your intention was to allow full discussion?

Mr. Speaker: My intention was what 1 said. I did not quite follow the hon. Member's point. I said that I had allowed the whole matter to be debated on the Motion. That was the point which I wanted to make.

Mr. Speaker: An hon. Member can make a second speech, so long as it is in Order.

Mr. Cocks: On that point of Order. You mentioned just now, Mr. Speaker, that the Bretton Woods Agreement was a treaty, and was not debatable by this House, but surely there are cases when treaties come before this House for ratification, and when they come forward for ratification they can be discussed in all their terms? Surely this Bill does relate to a treaty?

Mr. Speaker: I do not think so. This is not a treaty coming before this House in the manner suggested by the hon. Member.

9.35 p.m.

The Chancellor of the Exchequer (Mr. Dalton): I beg to move, "That the Bill be now read a Second time."
This Bill is a machinery Measure and it gives effect to the decision already reached by an emphatic Vote of the House. I do not intend, of course, to go into the merits of the matter; I am merely going to indicate that this Bill provides in a few simple Clauses the measures necessary to enable this country to become a foundation member of the Bretton Woods Organisation for the purpose of becoming a member of the Fund and a member of the Bank. This is a short and simple Bill. It authorises the payment of our subscription to the Fund and to the Bank to the extent that is described in the two Agreements. It enables us to make certain compensatory payments if these should ever be required consequent upon any future variations within the terms of these instruments in the value of sterling, and it empowers us to take the necessary action if we withdraw from the Fund and if the Fund, in consequence of our withdrawal, is wound up. These are the minimum powers taken in this Bill if we are to be, as the House has decided that we ought to be, effective members of these two new international organisations. On the other hand, this Bill deliberately does not provide for any future increase in the United Kingdom subscription to these two organisations. If that should seem desirable later on as events develop, a further Bill will need to be introduced to give effect to that.
I will briefly indicate the contents of the few Clauses. Clause I is merely a statement that if the Bretton Woods Agreements are signed by His Majesty's Government, as they will now be signed, the provisions of the next two Clauses shall have effect. Clause 2 deals with the financial provisions necessitated by signature, that is to say, the payment of the subscriptions, and the various payments there indicated will be met in the usual way by payments from the Consolidated Fund, unless they are connected with the buying or selling of gold and exchange or with incidental expenses, in which two cases they will be met, not from the Consolidated Fund, but from the Exchange Equalisation Account. Clause 3 enables His Majesty to pass Orders in Council to give effect to certain provisions in the Agreements, as you, Mr. Speaker, indicated just now in your reply to a point raised by an hon. Member, conferring what we commonly call diplomatic status upon persons operating on behalf of the Fund and the Bank and upon the Fund and the Bank themselves and their staffs. This is common form and is usual in such arrangements. These Orders in Council under Clause 3 would also enable us to carry out our undertaking if the Fund agreed to render certain exchange contracts unenforceable in accordance with the provisions there laid down.
Finally, in view of the time limit which I have mentioned, Clause 3 has to provide that Orders such as I have referred to shall operate throughout the territories over which His Majesty has jurisdiction, excluding, of course, the self-governing Dominions, who operate on their own. Canada has already taken the necessary action. I would emphasise that, as far as this Bill is concerned, all the financial liabilities arising there from are borne by His Majesty's Government in the United Kingdom exclusively. This, as I hope the House will agree, is a simple Measure consequential upon the decision already taken.

9.4. P.m.

Captain Crookshank: There seems very little to be said on this Bill. It is a curious thing. It is an enabling Bill, but it is also a contingent Bill, because if it were passed tonight nothing would happen as a result of it. It cannot be called into life until, in the

words of Clause I, "the said Agreements are signed." Therefore it is a purely enabling Bill against the event of His Majesty's Government signing these Agreements. If we are to discuss a principle on Second Reading, which is the normal practice of the House, the only principle I can see that emerges is the somewhat self-evident proposition that if you do with full solemnity sign a document, it is reasonable you should take the necessary steps to make it effective. That is the sole principle. It does not seem to be a very contentious principle. It may be that on Clauses 2 and 3 there may be some points to be dealt with in the Committee stage, but such Committee points, I take it, would be out of Order on the Second Reading. Therefore, there is really nothing that can usefully be said now.

9.42 p.m.

Mr. Boothby: I am very sorry I am not allowed to discuss the principle of the Bretton Woods Agreement, which I have been waiting to do for the last 18 months. There are, however, one or two questions of purely technical detail which I am entitled to ask the Chancellor arising out of the finance we are asked to provide in the Bill. It is widely assumed that this Agreement and the Bill to implement it will provide stability of exchange rates. I want to ask my right hon. Friend if this is something which is justified. Article IV, Section 4 (a) states:
 Each member undertakes to collaborate with the Fund to promote exchange stability, to maintain orderly exchange arrangements with other members, and to avoid competitive exchange alterations.
Does this mean that each member under takes to maintain its currency at the agreed par value with dollars and, therefore, with gold? If it does, it would have been very simple to say so in the Agreement. Of course, if it does there is no further argument. If it does not the whole scheme makes nonsense, because under Article IV, Section 4 (6), of the Bretton Woods Agreement:
 A member whose monetary authorities, for the settlement of international transactions in fact freely buy and sell gold within the limits prescribed by the Fund under Section 2 of this Article shall be deemed to be fulfilling this undertaking.
What does this mean?

Mr. Speaker: I really do not think it is in Order for the hon. Member to raise that matter.

Mr. Boothby: I do not know whether I can try another question, Mr. Speaker. It seems to me I am absolutely hamstrung. I do not know where I am, or where I can start. I do not think I can do anything more than make a vehement, violent and vigorous protest, and say that if I were not of such a genial disposition, I should be almost tempted to challenge your Ruling and be removed by force by the Serjeant-at-Arms from the House.

9.44 P.m.

Lieut.-Colonel Dower: I rise to ask for your Ruling, Mr. Speaker, as to whether it would be in Order for a Member to bring to the notice of the House that if this Bill is passed there is nothing contained in it that will enforce the Congress of the United States to adopt and ratify the Financial Agreement.

Mr. Speaker:: I do not think that can be raised on the Second Reading of the Bill. The first Clause starts with an if," and if the hon. and gallant Member

proceeds to put another "if," I do not know where it will lead us. We cannot deal with these hypothetical matters.

Captain Blackburn: May I ask whether it would be in Order for me to argue, in relation to the possible participation of Australia and New Zealand, as mentioned in the Preamble, that the co-operation of Australia and New Zealand might, perhaps, turn upon our supporting them at some stage in objecting to the prohibition of reciprocal trade agreements under the proposed American document?

Mr. Speaker: What Preamble is the hon. and gallant Gentleman referring to?

Captain Blackburn: I beg your pardon, Mr. Speaker, I mean the Explanatory and Financial Memorandum.

Mr. Speaker: That is not in the Bill.

Question put, "That the Bill be now read a Second time."

The House divided: Ayes, 314; Noes, 50.

Division No. 51.]
AYES.
9.45 p.m.


Adams, Capt. Richard (Balham)
Byers, Lt.-Col. F.
Farthing, W. J.


Adams, W. T. (Hammersmith, South)
Callaghan, James
Foster, W. (Wigan)


Adamson, Mrs. J. L.
Chamberlain, R. A.
Fraser, T. (Hamilton)


Alexander, Rt. Hon. A. V.
Champion, A. J.
Freeman, Maj. J. (Watford)


Allen, A. C. (Bosworth)
Chater, D.
Freeman, Peter (Newport)


Allen, Scholefield (Crewe)
Chefwynd, Capt. G. R.
Gaitskell, H. T. N.


Alpass, J. H.
Cluse, W. S
Ganley, Mrs. C. S.


Amory, D. Heathcoat
Cobb, F. A.
George, Lady M. Lloyd (Anglesey)


Anderson, A. (Motherwell)
Coldrick, W.
Gibson, C. W.


Anderson, F. (Whitehaven)
Collick, P.
Gilzean, A.


Attewell, H. C.
Collindridge, F.
Glanville, J. E. (Consett)


Attlee, Rt. Hon. C. R.
Colman, Miss G. M.
Glyn, Sir R.


Austin, H. L.
Comyns, Dr. L.
Gooch, E. G.


Ayles, W. H.
Cook, T. F.
Goodrich, H. E.


Ayrton Gould, Mrs. B.
Corlett, Dr. J.
Gordon-Walker, P.C.


Bacon, Miss A.
Crawley, Fit.-Lieut. A.
Greenwood, Rt. Hon. A.


Baird, Capt. J.
Crossman, R. H. S.
Grey, C. F.


Balfour, A.
Daggar, G.
Grierson, E.


Barnes, Rt. Hon. A. J.
Daines, P.
Griffiths, D. (Rother Valley)


Barstow, P. G.
Dalton, Rt. Hon. H.
Griffiths, Rt. Hon. J. (Llanelly)


Barton, C.
Davies, Edward (Burslem)
Gunter, Capt. R. J.


Battley, J. R
Davies, Clement (Montgomery)
Guy, W. H.


Bechervaise, A. E.
Davies, Ernest (Enfield)
Hall, Rt. Hon. G. H. (Aberdare)


Belcher, J. W.
Davies, Haydn (St. Pancras, S.W.)
Hall, W. G. (Colne Valley)


Benson, G.
Davies, S. O. (Merthyr)
Hamilton, Lieut.-Col. R.


Berry, H.
Deer, G.
Hannan, W. (Maryhill)


Bevan, Rt. Hon. A. (Ebbw Vale)
de Freitas, Geoffrey
Hardy, E. A.


Bing, Capt. G. H. C.
Diamond, J.
Harris, H. Wilson


Binns, J.
Dobbie, W.
Hastings, Dr. Somerville


Blenkinsop, Capt. A.
Dodds, N. N.
Haworth, J.


Blyton, W. R.
Driberg, T. E. N.
Henderson, A. (Kingswinford)


Boardman, H.
Dugdale, J. (W. Bromwich)
Henderson, J. (Ardwick)


Bowden, Flg.-Offr. H. W.
Dumpleton, C, W.
Herbison, Miss M.


Bowen, R.
Durbin, E. F. M.
Hewitson, Capt. M.


Bowles, F. G. (Nuneaton)
Dye, S.
Hobson, C. R.


Braddock, Mrs. E. M. (L'p'l, Exch'ge)
Ede, Rt. Hon. J. C.
Holman, P.


Brook, D. (Halifax)
Edwards, A. (Middlesbrough, E.)
Hope, Lord J.


Brooks, T. J. (Rothwell)
Edwards, John (Blackburn)
House, G.


Brown, George (Belper)
Edwards, N. (Caerphilly)
Hoy, J


Brown, T. J. (Ince)
Edwards, W. J. (Whitechapel)
Hubbard, T.


Bruce, Maj. D. W. T.
Evans, E. (Lowestoft)
Hudson, J. H. (Ealing, W.)


Burden, T. W.
Ewart, R.
Hughes, Hector (Aberdeen, N.)


Burke, W. A.
Fairhurst. F.
Hynd, H. (Hackney, C.)




Hynd, J B.(Attercliffe)
moyle, A.
Smith, T. (Normanton)


Isaacs, Rt. Hon. G. A.
Murray, J. D.
Snow, Capt. J. W.


Janner, B.
Nally, W.
Solley, L. J.


Jeger, Capt. G. (Winchester)
Neal, H. (Claycross)
Sorensen, R. W.


Jeger, Dr. S. W. (St. Pancras, S.E.)
Nichol, Mrs. M. E. (Bradford, N.)
Soskice, Maj. Sir F.


Jones, A. C. (Shipley)
Nichollas, H. R. (Stratford)
Sparks, J. A.


Jones, D. T. (Hartlepools)
Noel-Baker, Capt. F. E. (Brentford)
Spearman, A. C. M.


Jones, P. Asterley
Noel-Baker, Rt. Hon. P. J. (Derby)
Stamford, W.


Keenan, W.
Noel-Buxton, Lady
Steele, T.


Kenyon, C.
Oldfield, W. H.
Stewart, Capt. Michael (Fulham, E.)


Key, C. W.
Oliver, G. H.
Strachey, J.


King, E. M.
Orr-Ewing, I. L.
Strauss, G. R.


Kinghorn, Sqn.-Ldr. E.
Paget, R. T.
Stross, Dr. B.


Kinley, J.
Paling, Rt. Hon. Wilfred (Wentworth)
Summerskill, Dr. Edith


Kirby, B. V.
Paling, Will T. (Dewsbury)
Symonds, Maj. A. L.


Lang, G.
Palmer, A. M. F.
Taylor, H. B. (Mansfield)


Lavers, S.
Pargiter, G. A.
Taylor, R. J. (Morpeth)


Lawson, Rt. Hon. J. J.
Parkin, Flt.-Lieut. B. T.
Taylor, Dr. S. (Barnet)


Lee, F. (Hulme)
Paton, Mrs. F. (Rushcliffe)
Thomas, Ivor (Keighley)


Leonard, W.
Paton, J. (Norwich)
Thomas, I. O. (Wrekin)


Leslie, J. R.
Peart, Capt. T. F.
Thomas, John R. (Dover)


Lewis, A. W. J. (Upton)
Perrins, W.
Thomas, George (Cardiff)


Lewis, J. (Bolton)
Piratin, P.
Thorneycroft, H. (Manchester, C.)


Lewis, T. (Southampton)
Platts-Mills, J. F. F.
Tiffany, S.


Lindgren, G. S.
Poole, Major Cecil (Lichfield).
Tolley, L.


Lipton, Lt.-Col. M.
Popplewell, E.
Tomlinson, Rt. Hon. G.


Logan, D. G.
Porter, E. (Warrington).
Turner-Samuels, M.


Longden, F.
Porter, G. (Leeds).
Ungoed-Thomas, L.


Lucas-Tooth, Sir H.
Proctor, W. T.
Vernon, Maj. W. F.


Lyne, A. W.
Pryde, D. J.
Viant, S. P.


McAdam, W.
Pursey, Cmdr. H.
Wadsworth, G.


Mack, J. D
Randall, H. E.
Walkden, E.


McKay, J. (Wallsend)
Ranger, J.
Walker, G. H.


Mackay, R. W. G. (Hull, N.W.)
Rankin, J.
Wallace, G. D. (Chislehurst)


Maclean, N. (Govan) 
Rees-Williams, Lt.-Col. D. R.
Wallace, H. W. (Walthamstow, E.)


McLeavy, F.
Reid, T. (Swindon)
Watkins, T. E.


MacMillan, M. K.
Richards, R.
Webb, M. (Bradford, C.)


Macpherson, T. (Romford).
Ridealgh, Mrs. M.
Weitzman, D.


Mainwaring. W. H.
Robens, A.
Wells, P. L. (Faversham)


Mallalieu, J. P. W.
Roberts, Sq.-Ldr. Emrys O. (M'rion'th)
Wells, Maj. W. T. (Walsall)


Manning, C. (Camberwell, N.).
Roberts, Goronwy (Caernarvonshire)
White, H. (Derbyshire, N.E.)


Manning, Mrs. L. (Epping).
Roberts, W. (Cumberland, N.)
Whiteley, Rt. Hon. W.


Marples, Capt. A. E.
Robertson, J. J. (Berwick)
Wigg, Col. G. E. C.


Marquand, H. A.
Rogers, G. H. R.
Wilkes, Maj. L.


Marshall, F. (Brightside).
Royle, C.
Wilkins, W. A.


Mayhew, C. P.
Salter, Rt. Hon. Sir J. A.
Willey, F. T. (Sunderland)


Medland, H. M.
Sargood, R.
Willey, O. G. (Cleveland)


Medlicott, Brig. F.
Scott-Elliott, W.
Williams, Rt. Hon. E. J. (Ogmore)


Middleton, Mrs. L.
Segal Sq.-Ldr. S.
Williams, Rt. Hon. T. (Don Valley)


Mikardo, Ian
Sharp, Lt.-Col. G. M.
Williams, W. R. (Heston)


Millington, Wing-Comdr. E. R.
Shawcross, Sir H. (St. Helens)
Williamson, T.


Mitchison, Maj. G. R.
Shepherd, Lieut. W. S. (Bucklow)
Willis, E.


Monslow, W.
Shinwell, Rt. Hon. E.
Wills, Mrs. E. A.


Montague, F.
Shurmer, P.
Wilmot, Rt. Hon. J.


Moody, A. S.
Silverman, J. (Erdington)
Wilson, J. H.


Morgan, Dr. H. B.
Silverman, S. S. (Nelson)
Wise, Major F. J.


Morley, R.
Simmons, C. J.
Woodburn, A.


Morris, Lt.-Col. H. (Sheffield, C.)
Skeffington, A. M.
Woods, G. S.


Morris, P. (Swansea, W.)
Skinnard, F. W.
Wyatt, Maj. W.


Morris, Hopkin (Carmarthen)
Smith, Capt. C. (Colchester)
Yates, V. F.


Morrison, Rt. Hon. H. (Lewisham, E.)
Smith, Ellis (Stoke)
Zilliacus, K.


Mort, D. L.
Smith, S. H. (Hull, S.W.)
TELLERS FOR THE AYES:




Mr. Mathers and Mr. Pearson




NOES.


Aitken, Hon. M.
Gammans, L. D.
Savory, Prof. D. L.


Baldwin, A. E.
Hannon, Sir P. (Moseley)
Smiles, Lt.-Col. Sir W.


Bossom, A. C.
Harvey, Air-Comdre. A. V.
Smith, E. P. (Ashford)


Bower, N.
Holmes, Sir J. Stanley
Stoddart-Scott, Col. M.


Braithwaite, Lt.-Comdr. J. G.
Kendall, W. D.
Stokes, R. R.


Carson, E.
Lancaster, Col. C. G.
Taylor, Vice-Adm. E. A. (P'dd't'n, S.)


Collins, V. J.
Lloyd, Brig. J. S. B. (Wirral)
Teeling, Flt.-Lieut. W.


De la Bère, R.
Lucas, Major Sir J.
Thorneycroft, G. E. P. (Monmouth)


Dodds-Parker, Col. A. D.
Macpherson, Maj. N. (Dumfries)
Touche, G. C.


Donner, Sqn.-Ldr. P. W.
Marlowe, A. A. H.
Wakefield, Sir W. W.


Dower, E. L. G. (Caithness)
Mellor Sir J.
Walker-Smith, Lt.-Col. D.


Duthie, W. S.
Molson, A. H. E.
Ward, Hon. G. R.


Erroll, Col. F. J.
Moore, Lt.-Col. Sir T.
White, D. (Fareham)


Evans, S. N. (Wednesbury)
Nutting, Anthony
Williams, Lt.-Comdr. Gerald (Tinbr'ge)


Foot, M. M.
Peto, Brig. C. H. M.



Fox, Sqn.-Ldr. Sir G.
Prior-Palmer, Brig. O.
TELLERS FOR THE NOES


Fraser, Maj. H. C. P. (Stone)
Renton, D.
Mr. Boothby and


Fraser, Lt.-Col. Sir I. (Lonsdale)
Roberts, H. (Handsworth)
Squadron-Leader Hollis


Question put, and agreed to.

Bill accordingly read a Second time.

Bill committed to a Committee of the

Whole House for Tomorrow.—[Mr. Ede.]

Orders of the Day — BRETTON WOODS AGREEMENTS [MONEY]

Considered in Committee under Standing Order 69.

[Major Milner in the Chair]

Resolved:
That for the purposes of any Act of the present Session to enable effect to be given to certain international agreements for the establishment and operation of an International Monetary Fund and an International Bank for Reconstruction and Development, and for purposes connected with the matters aforesaid, it is expedient to authorize—

(a) the payment out of the Consolidated Fund of any subscriptions, compensation or other sums payable to, or to the members of, the said International Fund (hereinafter referred to as "the Fund ") or the said International Bank (hereinafter referred to as "the Bank ") under the said agreements and of any sums required for implementing any guarantee of the assets of the Fund against loss resulting from failure or default of a depository designated by His Majesty's Government in the United Kingdom under the first of the said Agreements, and the raising of money under the National Loans Act, 1939, for the purposes of providing the sums paid as aforesaid;
(b) the payment into the Exchequer of any sums received by His Majesty's Government from the Fund or the Bank (other than sums received by reason of the operations of the Exchange Equalisation Account);
(c)the payment out of the Consolidated Fund of sums paid into the Exchequer under the last preceding paragraph, and the application of the sums so issued in redemption or repayment of debt, or, in so far as they represent interest, in payment. of interest otherwise payable out of the permanent annual charge for the National Debt;
(d)the payment out of the Consolidated Fund of any sums falling to be paid there from into the Exchange Equalisation Account by reason of any provision of the said Act authorising the payment out of the said Account of any charges payable to the Fund; and
(e)the payment out of the Consolidated Fund of any sums payable under any notes or other obligations created and issued to the Fund or the Bank under the said agreements.—(King's Recommendation signified.)—[Mr. Dalian.]

Resolution to be reported Tomorrow.

Orders of the Day — GREAT POWERS (FAR EASTERN POLICIES)

Motion made, and Question proposed, "That this House do now adjourn."—[Mr. Joseph Henderson.]

10.30 P.m.

Mr. Callaghan: The subject on which I desire to submit certain observations this evening, is the policy of the Great Powers in the Far East, and particularly the policy of the United States of America in China and Manchuria. I hoped to catch your eye, Mr. Speaker, during the course of our discussions on the Loan Agreement, but I was unfortunate, and in consequence I have been walking round the whole day with two speeches in ray pocket. I hope I shall not get them mixed now, but if I do perhaps it would not matter very much, because the text of both speeches is that of the economic aggression of the United States. Let me say how grateful I am to the Minister of State for coming here this evening. He has had a long and trying day at the United Nations Organisation, and with our arrangements tonight he was not sure whether this subject would be taken, and I do not expect a full answer from him.
However, I think it important to make certain of these observations in order that, when the Foreign Secretary goes to Moscow very shortly, he should be apprised of the point of view of at least some of us in this House. May I say, because I want to be critical of the United States, that I have a great affection for them? I had the honour of serving with some United States members of the Forces during the war, and I have a great affection for them as anybody must have who has experienced their individual hospitality and their kindness. However, those traits do not reveal themselves when they are translated into some of their foreign policies, and in the case of their Far-Eastern policy, I am afraid that much of what they are doing is not in accordance with what most of us in this. House would like to see. There are important elements—such as General Hurley, the Ambassador, who has just resigned—who believe that the policy for the United States is to support General Chiang Kai-shek against the Communists, to stretch the Lend-Lease arrangements so as to continue the supply of armaments to General Chiang Kai-shek in order that he may continue his war against the Communists. That, if I may say so, is a rather wry thought—that this country should have to measure our shattered homes against a loan of several million American dollars, when some important


sections of the United States are prepared to continue to stretch Lend-Lease arrangements in order to supply China with arms to continue a civil war.
There are other factors too. I believe that the Americans have failed to disarm many of the Japanese in these areas in China and Manchuria to which I am referring. Some of them—General Hurley, I believe, is one—seem to be prepared to support General Chiang Kai-shek in his policy of incorporating puppet armies, which formerly fought with the Japanese, into the Nationalist Army to fight against the Communist section and to support him in his appointment of pro-Japanese officials.
All these things are going on out there, and it is because they are so disquieting, that I felt bound to keep the House tonight after the very tiring day we have had. For what purpose are these things being done? It is, I fear, because the Americans have set out on a plan of economic aggression in the Far East. They desire to capture the trade of China, they desire to build railways, they desire to string China with roads and, for those reasons, I believe, important elements in America are pursuing a foreign policy in the Far East which will prolong indefinitely the civil war which has broken out there. For that reason I think it is important that our Foreign Secretary should go to Moscow with certain very strong representations that he should make on this situation.
I do not believe—in fact, I know—that the whole of the people of the United States do not share the views of General Hurley. There are some American Congressmen today who are opposing very vigorously American policy in the Far East, and they have the support of considerable numbers of the American people. However, the result of this dichotomy of American policy is confusion. What is their policy in the Far East? If I might use the words of the Foreign Secretary, "What is it they want? Let them put their cards face upwards on the table." Let us know which policy they are pursuing out there, because it is of such vital importance to the future of world peace. If the United Nations do not agree on their policy in this part of the world, let us be under no delusion as to the result. The seeds of world war

are being sown today out there, and do not let us forget that just as the last shots in this present war were fired in the Far East, so were the first shots fired out there. It is of the utmost importance, therefore, that our Foreign Secretary should go to Moscow prepared to say these things to the Americans and to ask them to state clearly what is their policy.
Two things should be done. The first is, that the Americans should withdraw all their troops from Manchuria, and the second thing is, that the United Nations Organisation or the Big Three—as the United Nations Organisation has not yet been clothed in a garment—should be responsible for the conduct of free democratic elections in China at the present time throughout the whole of the area. General Chiang Kai-shek talked about free elections in the future, but that is not good enough. We ought to have a decision on this issue fairly quickly and I believe that China could take it.
I would refer to the question of the Far Eastern Advisory Commission. My right hon. Friend the Minister of State told me three weeks ago, in reply to a question, that Russia had not declined to take part in the Far Eastern Advisory Commission and discussions were still proceeding, but the fact remains that she still has not taken part in it. Russia is outside those discussions for the excellent reason that she is asked to take part in an advisory commission and not a Control Commission. It is the Control Commission that Russia and Australia and China, and many other nations, who, too, have suffered from Japanese aggression, desire, and that is what we should have.
American policies in Japan at the moment are to some extent satisfactory; in other aspects they are clearly unsatisfactory. May I give one illustration. I have drawn the attention of the House before to the fact that Prince Konoye is still permitted to remain the voice of the throne in Japan. Anybody who examines Prince Konoye's record must know that he cannot be the friend either of the West or of democracy, in the sense that the United States and ourselves understand it. We are told that, if we insist on a.Control Commission, General Mac Arthur will resign his job, but with great respect to that very fine soldier, it is not a soldier's job any longer. It


is not a job which should be done by the military. The period of military operations is over. What are we going to do to re-educate the Japanese? That is really the point to which we ought to address ourselves. I was aghast two or three days ago to read that Prince Konoye said that the Japanese constitution was really democratic and he thought it needed only minor alterations. If I had time, I would take the House, if it had the patience, with me through the Articles of the Japanese Constitution. Let me take just one. Article 3 says that the Japanese Emperor is "sacred and inviolable." Does that sound like a democratic institution?
I put it to the House that General Mac Arthur's own personal dignity and personal position must not be-allowed to stand between the attempt of the United Nations to re-educate the Japanese people to bring them into the comity of nations and if he will not subordinate his dignity, which is the reasonable thing to do, then, with great respect, General Mac Arthur must go. I hope that the Foreign Secretary will be able to convey some of these sentiments if indeed, that is the view of the Government, too, and the other nations with whom we shall be negotiating in Moscow. I want to give the Minister time to reply, so I will conclude on one note. The Far East is the powder keg of the world. In the Foreign Affairs Debate we heard a lot then about South-East Europe, Jugoslavia and the Balkans. I have no doubt that they are important, but, with great respect to those who espoused the case of South-East Europe, they do not matter a jot by comparison with the peril which will confront the world if the problems of China and Japan are not settled. It is to these problems that we must turn our minds. These countries may be a long way away, but they affect vitally the whole future of the world, and it is for that reason that I have ventured to detain this House this evening on what, I believe, to be one of the most important subjects that concerns us.

10.16 p.m.

Mr. R. A. Butler: I wish to reinforce, in some respects, what the hon. Member for South Cardiff (Mr. Callaghan) has said. This matter was brought to the attention of the Government in the Debate on foreign affairs and

problems of the Far East were brought up on this side of the House by the hon. Member for Bury (Mr. W. Fletcher) and to some extent by myself and others, as well as by hon. Members on the other side of the House. I think that the Government paid very little attention to the Far East in their reply, and that it is therefore incumbent upon the Minister of State to give tonight some sort of answer on these vital problems. The problems of the Far East with which I had the misfortune, or the fortune, to deal with at the Foreign Office, are of immense magnitude and importance, I feel, therefore, that the hon. Member was not exaggerating when he said that in these problems might lie the whole future of world security. I trust that the right hon. Gentleman in his reply will devote a little time to the arguments of the hon. Member. I feel that what he has said about the Far Eastern Commission is very true. We are not aware, at the present moment, what is the position. We hope that there is a friendly attitude towards Soviet Russia, but we are not aware whether Soviet Russia is participating or whether it is intended that she should participate. I shall be delighted if the right hon. Gentleman, in his reply, can give some answer on that point. The problems of the Far East have in them, I think, not only those ideological features which the problems of the West have, but have also immense physical features, and they are on a far larger scale, in relation to future world development, than the problems of Europe. They have the same characteristics, but in a larger degree. I do not want to complicate the task of the right hon. Gentleman, but I do not think it right to say that the Foreign Office should regard Far Eastern questions as being such that they cannot be dealt with on the Floor of the House because they are too ticklish and too delicate. I think it is time that the Government told us what their policy is in this sphere, and I feel sure that they will be able to handle it with the same discretion as that with which they are attempting to handle other international problems.

10.18 p.m.

The Minister of State (Mr. Philip Noel-Baker): I will do my best to give my hon. Friend the Member for South Cardiff (Mr. Callaghan) and the right hon. Gentleman the Member for Saffron

`
Walden (Mr. R. A. Butler) as good an answer as I can. I must explain my difficulties to the House. I have been at other meetings until about an hour ago. After the Division at 9.15 I received information that this subject was not going to be brought up tonight. I despatched my advisors to their homes, and thought no more about it. I must, therefore, answer ex tempore and without any advice on questions about the raising of which I had no previous information. I understood that my hon. Friend was to raise something entirely different. That being so, the House will realise that they will not get an extremely good answer. Perhaps we shall have another chance, and that I shall have a better chance, and that it will be better for all concerned. I want to assure the right hon. Gentleman that the Government desire nothing better than to discuss Far Eastern affairs here, whenever the usual channels can find the time, and to do so in the fullest and frankest manner. I assure him that Far Eastern questions are the subject of continuous and thoughtful deliberation in the Foreign Office, quite as much as the affairs of any other part of the world. We are well aware that the peace of the world depends on the willingness of the powers in the Far East to adjust their differences by frank discussion and mutual confidence. We believe that the principles on which our general foreign policy is based, our adherence to the institutions of the United Nations, the application of the principles of the Charter for dealing with international difficulties and disputes which are not otherwise resolved£we believe these principles apply in the Far East as they do elsewhere. We believe that if they had been applied in the Far East in 1931 we should not have had the ghastly tragedy in Europe through which we have passed.
My hon. Friend said that the period of military occupation in Japan was over. How many months is it since fighting really ended, since we were able to send even our advance troops into these areas? Not much more than three. Our experience in Germany has shown how very difficult it is, in the occupation of a great country, to combine the necessity of thorough disarmament and the punishment of the guilty with the necessity of preserving some central authority, which can carry out the orders of the occupy-

ing Power, so that the whole work of maintaining order, of providing the police service, does not fall upon the soldiers of the occupying Power. It is a very difficult task, and it would be intolerable if the soldiers of the occupying Allied armies had to perform all the duties of the police force, to maintain the law against those who are now, alas, in all those countries much too well armed, and filled with the most dangerous doctrines; it would be intolerable if Allied soldiers had to bear the full burden of maintaining peace and order against criminals and gangsters of every kind. That task, in Germany, has proved extremely difficult. We have not solved it yet. And in Germany, with much simpler problems to deal with. we are not yet out of the period of military government.
Owing to the peculiar structure of the Japanese State, whose institutions depend so directly on the Emperor, General MacArthur has encountered that difficulty in its most acute form, and I want to pay a great tribute, on behalf of the Government, to General MacArthur, as a great military leader and a soldier of incomparable gallantry, who rendered immense service to the Allies in the earlier stages of the war, as well as throughout the whole period of his command. I cannot now accept any criticism of him. I do not answer, of course, for the United States Government, but I must say that the United States Government has shown itself willing and anxious to share the burden of solving this difficulty with its Allies. There is no suggestion that final decisions on policy will be taken about Japan by the American Government without consultation with her Allies. The machinery by which that consultation can be carried out, the working out of a common policy, can be most effectively achieved by means to which we are now giving our full attention, with the hope that results will come in the relatively early future.
I turn to China. There, if I may say so, my hon. Friend made some sweeping assertions. He said that the Americans were failing to disarm the Japs. He said that General Chiang Kai-shek, the head of the Government we recognise, the head of the Government which resisted the Japanese in 1931, and again later, is appointing pro-Japanese officials. He went on to say that the United States have set out on what he called a campaign


of American economic aggression, and that they were planning to build roads and railways and other public works in China. This House tonight has expressed approval of the receipt by this country of a great loan from the United States. I confess I hope that China will also receive a loan from the United States, that roads and railways will be built in China, that rivers will be controlled, as the Tennessee River was controlled, that the people of China will be saved from the appalling disasters which have overtaken them and their land, and will be enriched as the United States has been enriched by the T.V.A. Scheme which President Roosevelt initiated and carried through. And, if that is done, I do not believe that the Americans will do it with any intention whatever of establishing their political control over the Chinese Government. I utterly repudiate that suggestion.
I fail completely to understand what my hon. and gallant Friend wants us to do about those who are called the Chinese Communists. Of course, H.M. Government are anxious that all difficulties in China shall be solved without further bloodshed. We have done everything in our power to encourage, so far as we properly can, the settlement by agreement of any internal difficulties there may be. But these are, in the last resort, matters for the Chinese themselves. I do not know if my hon. and. gallant Friend proposes that we should recognise those whom he called the Chinese Communists, as the government of the Northern part of China. Does he suggest that the three provinces in Manchuria, which were taken from China by Japan as the first act of aggression in the world war, should now be retained by Russia, or by the Communists, and should not be taken over by the Government we now recognise as the government of China? I do not think that we could now accept any policy like that and, if I may say so, my hon. and gallant Friend himself did not seem to me very clear in his own mind as to what he thought was wanted. I am quite certain that it would not be in the general interest of the world if anybody attempted to obstruct the reoccupation of Manchuria by the forces of the government which we recognise today.
Lastly, my hon. and gallant Friend said that there ought to be free democratic elections in China at once. I do

not know when the last tree democratic election was held in China, but I think it was a little time ago. Certainly Sun-Yat-Sen proposed a series of stages, and did not think that they could reach the stage of free democratic election for some time. In local government, there have been elections, and they have worked extremely well; but local government:s a very different thing from the national government of an immense area like China, the people of which cannot even understand each other when they speak, because the spoken languages are quite different; and there are 450 million of them. France has been liberated for nearly 18 months. She only held her first free, democratic election the other day, and France has had free, democratic government for a very long time. Norway has had an election, but Belgium and Holland have not yet got to a stage where they can have one. To demand that there should be free democratic elections now, in China, is to ask for something which is over-optimistic in the conditions which now obtain.

Mr. Caltaghan: General Chiang Kai-shek did expect that there would be elections.

Mr. Noel-Baker: I hope there will be. but it will be some time before they are prepared. The Japanese have not yet all been cleared out, and their final disarmament must still be carried through; order must be re-established; we must have some settlement between the Communists and the rest. Of course, all these are essential pre-conditions of an election. We hope that these conditions may be fulfilled as rapidly as possible. We want to see China progress, as we believe she can and should progress, with rapidity towards an ordered democratic system in which all Chinese shall live in peace together, without resort to violence of any kind. We look forward to economic development and democratic progress in China. Whatever His Majesty's Government can do to promote these things, will certainly be done. But we shall not promote them by using hard words about our American allies, who have performed so great a task in the Far East.

10.30 p.m.

Flight-lieutenant Teeling: I would like to say a few words, in view


of the fact that the Foreign Secretary is going tomorrow to these conferences, at which, no doubt, questions concerning the Far-Eastern situation will be raised. These matters are causing the greatest worry to those who know about the Far East. The Foreign Office is, as far as we can see, taking the greatest care over the whole matter, but there arc, unfortunately, very few people, in the United States or in this country, who can speak Japanese. Yet, we hear that General Mac Arthur is telling the Japanese Government completely to alter its system, to commence at once the alteration of the feudal system of the country, though there is in that country a most illiterate and politically ill-educated people. There will be the most frightful chaos there unless you have specialists on the spot, who, knowing the language, can tell the Japanese what to do. There are only a few specialists in the United States and in Great Britain, and these are mainly missionaries and I am not at all happy that the right people are going to Japan, or that the missionaries are the right people to start the essential reforms. In the Foreign Office at present there are some experts on the Japanese language, but not many. Not everybody I met from the Foreign Office when I was out in Japan could speak Japanese. It is a very serious problem, and I hope it may be possible to do something at this Conference of Foreign Ministers, to see that the discussions which will have to take place, on Far Eastern problems, will not be continued outside Japan but will be discussed inside Tokyo.
There is one other point. We should watch very carefully what is done about

replacing the Emperor or undermining his position unless we are certain that we have someone who could take his place. I knew the Emperor's brother fairly well, because he was educated at my college at Oxford, and I formed the opinion that he and the small group round him, were about the only people in that country who had anything like democratic ideas. They were Liberal statesmen and I think that only these and their like could help us at the present moment. Unfortunately their sons were taken away from them during and before this war, and their fathers were threatened, even blackmailed, and told that their sons would probably be shot if the fathers persisted in their Liberal beliefs. These older men might be of great use to us today. With regard to China, I would like to make one suggestion. In most of the interior of China when I was there the people I spoke to, whether from the North or in the South, happened to speak "pidgin English" and often only understood each other in "pidgin English." I quite seriously suggest that as soon as possible the subject of Basic English should be studied by the Foreign Office with a view to having it taught there. It would have to be at some future date, but the Russians, were, I understand, before the war very keen on it, and it might well be of use in Japan and China where there are so many languages, and so few people understand each other.

Adjourned accordingly at Twenty-eight Minutes to Eleven o'Clock.